back over to you guys. >> thank you very much, dom. mike, you've been saying all day this is what the market's waiting for. >> yes, and three month ago, it was a catalyst for the broad market now nvidia's at a high. goldman says positioning is high >> we will see what happens after the bell today, and we will see you back here tomorrow. make sure you join us. right now, it's time for "squawk on the street. ♪ good wednesday morning, welcome to "squawk on the street," i'm carl quintanilla with jim cramer at post nine of the new york stock exchange. david faber is on assignment all-time highs here, but futures are a bit cautious ahead of the big event tonight, and that is nvidia earnings. meantime, retail earnings are a bit mixed. target largely fails to impress. oil now down 2% for the week road map is going to begin with target's big miss, consumers buying fewer groceries and home goods shares are down sharply premarket. nvidia shares are coming off a record close and on track for

some gains at the open expectations are high for the chip maker's results after the bell watch apple. the midst of a seven-day win streak with a gain of nearly 13% so far this month. let's begin, though, with target down sharply on this quarterly earnings miss and a sales decline. the retailer did say customers cut their spending on discretionary and grocery. company did reaffirm full-year guidance, jim. they guided comps down and came in 3.7 >> when you talk to brian, he'll be insistent that this wasn't anything that you should find unexpected the thing that i'm struggling with is he talks about the consumer, in tepid terms walmart didn't walmart told about a consumer that's in good shape and price rollbacks. we didn't get price rollbacks from target until this week. so, i'm beginning to wonder whether target is out of position versus walmart.

where walmart is really starting to -- walmart plus -- represent a bargain. walmart can also subsidize sales because they have this terrific advertising business there may be apples to oranges walmart's really spread far afield from target target, to some degree, is missing the mark, and they have to -- maybe they have to up their game a bit but they may not have the scale of walmart i look at this, and i say, geez, it's really sliding in part because it just may not have such special merchandise that it can compete against a really revitalized walmart. walmart is just amazing. >> a walmart where grocery is 60%, and target's 20%. >> thank you it's grocery by the way, it's natural and organic. look, i think walmart's giving whole foods a run. wal walmart, under doug mcmillon, has become a company that looks

like costco, except for many more shop keeping units. here's what i think is coming down we've got amazon amazon prime we've got walmart, and we have costco it's the big three interestingly enough, rodney mcmull, when he's trying to get this deal done with albertson's and kroger, he keeps saying that's who you're up against there's a big three for food >> costco, amazon, and walmart >> it's the big three. >> the big three of food and i think that people have to start recognizing. one thing you have to do is go there. i often joke with walmart. we go to walmart maybe because i got a baker, and i got a yoga instructor. you don't go -- you go to where the money is, and if you can go to walmart, and they offer all sorts of -- much better -- much better set of merchandise than people think everything is a little bit cheaper. that's really nipping at target.

amazon, because of same-day, which they want so badly, what jassy has been saying, nipping at target, and then i got to tell you, costco, only 3,500 shop keeping units but they're so cheap when you talk to walmart, they say, yeah, then there's costco or go to amazon. they say, we're not going to beat costco. you've got this big three of really just, like, they're the grim reapers of everybody else and i thought that target's numbers were just okay by the way, i struggled yesterday. lowe's, we had marvin ellison, do-it-yourselfer not doing that much home depot was not a great quarter. they're catering to people who make toll homes. i'm saying that this may have been -- this may have been a quarter where we recognize there's a separation there's separation and walmart is really it shall t -- take a look at that stock price. >> citi points out we haven't yet hit the steep traffic comps,

the declines we saw when they had some of the pride merchandise. >> yes now, look, i think target's -- is good, and by the way, their numbers, the sheer volume versus 2019, is terrific. but they seem to be late to the rollback i mean, they rolled back monday? walmart rolled back gigantically, and costco, by the way, because it's so important to be in their stores, they're calling them up and say, you guys are so far off the mark we're going to introduce kirkland signature corn flakes unless you come down, and nobody has that kind of power, except for costco there's just three, and the rest of them have to change their game target, which i love to shop at -- costco down. oh, come on. that's good. you guys are so smart, you sellers. just such smart people you must be algo -- those guys are stanford comp sci. i just look at target, and i say, wow, brian's got -- he's

late to value. and walmart -- walmart is -- if you go to walmart, which no one does who has a suit and lives on wall street, you go to walmart, you say, what? what how did you get that jacket for 26 bucks >> you always talk about the surprise quotient that half the country has not discovered >> it's so exciting. i was talking with someone who lives down there that says they've got this fashion unit with people from the highest level of fashion in new york and chicago, and they're just -- they don't want to be talked about, and they're crushing fashion. now, i know i saw a really good ad, i think, on "saturday night live" for the chinese manufacturers. unbelievable hey, made without -- no prison labor. absolutely made with people -- not made by people whose religion we hate it's just brilliant. but i think that's another whole source of -- that's waste management, wm >> yes, yes. let's move on to the broader

markets. we'll talk more retail in a little bit >> we got a lot, because urban was really good. nasdaq ndx entering today's session at some closing highs, jim. of course, nvidia is the elephant in the room all day today. >> you mentioned apple i think it's worth mentioning that apple made the quarter, and then ever since then, people have been saying, wait a second, maybe it's a.i maybe it's going to take on android. maybe it has some ties, even, with nvidia, which i think we could -- i want to hear about tonight. but nvidia is going to try to tell a story, which is very different from what i think the street's looking for, and i'll give you an example. yesterday, there was a story, and i don't even want to mention the outlet, which said that amazon is -- >> yes >> amazon and nvidia said that story wasn't true. >> it was an "ft" piece. >> nvidia's very upset about it. nvidia says, can we just be who we are if you want to run a story that says amazon isn't buying chips,

is that designed to knock down nvidia's stock so there's a big short position is it down so you can get nvidia it's because it didn't matter. nvidia is going to talk about multi, multi, multiyear in the same way that when i first met jengsen, he says, when we put the man on the moon and mars, what we're going to have to do, it's a 2030 system, in 2030, you're going to have to change the -- the different computations i'm like, well, we're not putting a man on mars in 2030. he looks at me and says, how do you know i mean, jensen's going to go with the, how do you know? he's going to say this whole idea of blackwell, all these people nipping at our heels, other than a very good ben righteous piece this morning about why you would buy amd off the microsoft a.i. pc, because that's who's in there, they're just going to try to -- they're going to say, look, we're not where everybody else is. we're just a step -- you can't do video without us.

you can't get the robots without us nvidia is show and tell tonight for the future as opposed to the quarter. >> as for amazon, the other big news pieces today are a.i. revamp of alexa, which our kate rooney just brought us >> thank heavens >> $17 billion in datacenter investment in spain. one of the biggest tech investments in all of southern europe >> you have to be overseas by the way, this is what -- jensen's been begging people to do sovereign a.i., which is something that's kind of been forgotten. remember, santander, biggest bank in europe spain's made a major move. when i spoke with the amazon people about alexa, i said, you know, alexa sounds like she's an inmate on seroquel it's the most preferred drug for people in long-term penitentiaries i do think that what's happened is that they've lost billions on alexa. billions and it's time that alexa does not -- is not as really dense

and not really comprehensive i mean, if you ask -- let's say you asked alexa, "play beethoven's 7th. it will say, "beethoven's fifth. no, alexa, the seventh it doesn't get it. how about mozart it says, no, we don't have that. they have to get that thing better they know. what it really is great at is listening to you and your wife talk about -- you know, we got to get some -- we got to get a turkey so, it's got to be less of an interrogator of yourself and much more helpful. and they know it they know that that's the weakness when they say, do you want to know the ball scores i mean, the ball scores, what are you going to give me, cricket? they have to refine it i'm glad they're doing this because they're losing a fortune on -- a fortune on alexa >> meantime, have you seen the charts circulating this week of

the number of babies named alexa in the last couple years down down big >> down? yeah alexa, they may have to change her name go to zuul oh, no, that's bank of america it's dana. they should go to dana >> dana point? what >> dana from "ghostbusters." >> of course jim, as for the fed, we're not getting a lot of fed speak today, but waller yesterday. today, goldman says the waller comments does raise the risk that maybe july doesn't happen, but they don't change their forecast for a july cut. >> no. and you know, frankly, can we just stop it with the fed speak right now? i mean, we're in -- we're really in a zone where we are finding out who's lowering prices and who's making it so it's deflationary costco's rolled back two years walmart's rolled back two years. lowe's is rolling back to last year we're getting rollbacks, and that's the focus, and i think

the fed should go shopping what you're seeing are prices coming down. you're seeing the major suppliers having to lower prices conagra, lowering prices they're getting what they want >> well, it's interesting, in addition to oil being down, which we mentioned earlier >> how about that? >> the retailers are not changing their comp guidance, but they are upping eps margin guidance it's not like they're counting on traffic to improve. >> right >> whatever improvement comes is going to be internal >> what they ought to do is look at what tjx did, which is a terrific number. or williams sonoma what is laura albert doing i think she's offering affordable luxury. that's one of those raps that people have, but she does offer affordable luxury. her prices are really good, and she's digital first. digital first is winning by the way, let's go back to target they're not digital first enough they're better than they have been, but this walmart plus, i mean, walmart plus is just -- i mean, if you don't have walmart plus, you got to rethink your game >> yeah, but at least digital

comps were up, as opposed to physical -- >> they were, and brian will be mad at me. digital comps, i want to give it to them. i'm just saying that walmart plus is kitchen sink i was with someone who is a multibillionaire for dinner the other night. and he asked me, have you looked at the value on walmart plus i said, you're worth billions. he says, does it really matter walmart plus and then walmart plus has veterinary care. but this guy was -- billionaires are noticing walmart >> right >> i mean, that says something >> that's the other thing about target, jim. the discussion today about target 360 where you're paying a hundred bucks for some free shipping, whether that's too little, too late in that race. >> i have tremendous respect for brian cornell. i love going to their stores they've got these house brands that are fantastic but it's apples to oranges this walmart is doing things that -- i'm urging people to go to walmart this weekend. they'll be better at stock selection if they go and go into apparel. go into sporting goods go into the food aisles. do it.

you'll see the prices. and you'll say, they could not be real. i mean, it's not the crazy eddie, because he was a crook, but i don't understand -- like, a lot of people look at the prices and say, no, let's go check that price that can't be. and i don't have a lot of stores where i'm saying, no, that can't be it just can't be >> if you're looking at a discretionary retailer like target with comps negative, tjx, ascendant, walmart, your point is a powerhouse in grocery, is that a overall negative tell on the u.s. consumer? >> i think no. i think that the u.s. consumer is, as they said in that brilliant, brilliant urban outfitters call, the u.s. consumer is enthusiastic >> the urban quote was, "consumer demand remains robust." >> brilliant the consumer is enthusiastic, not exuberant. i know it sounds like a pedestrian to say, everybody's got to hear the urban call, but

urban has historically called fashion and described the zeitgeist. there can not be a consumer as enthusiastic at urban and not at target no urban's -- free people, amazing numbers. i want to talk macy's later, because i think macy's was the unsung story of yesterday, because people didn't read the conference call, didn't realize that tony spring is saying, listen, we're bringing in brands what's he bringing in? free people. it's a huge brand. anthropolgie is a huge brand i apologize to brian cornell and target it was a good quarter. it wasn't a great quarter. walmart was a great quarter. >> how many earnings have we seen where a super micro doesn't cut guidance but doesn't raise enough >> tjx, it's always the question, did they raise enough? they're a little conservative. i think they have. when they start the call, they absolutely just say, listen, whatever positives you're

thinking, take it back that's who they are. i like people who say, whatever positives you're thinking -- i talked about this with marvin ellison from lowe's -- whatever positives you're thinking, why don't you mention it >> take a look at the premarket. there's a lot more to get to this morning we'll get to news on lulu. there's some tesla news. new street high target for goldman out of b of a futures mixed here ♪ ♪ welcome to the roots of our legacy. where excellence, comfort, and electricity... are forever in bloom. welcome to beyond. the mercedes-maybach eqs suv. trading at schwab is now powered by ameritrade,

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♪ our view of the consumer and the environment remains the same as 90 days ago and we're pleased that q1 results were firmly in line with our expectations while we won't be satisfied until we return to growth, we're

encouraged by the meaningful progress we've seen in recent quarters these positive indicators include improving topline trends, resumption of digital growth in the first quarter, led by double-digit growth in drive-up continued growth in our beauty category and a meaningful improvement in our apparel comp in q1 these trends reinforce our confidence that we're on the right track and positioned to get back to growth in q2 >> that's target's brian cornell on the earnings call a few moments ago, echoing the point, jim, that you started out with, which is that a lot of this shouldn't be a surprise. >> they are saying discretionary spending is likely to remain under pressure in the near term and that is their view that the consumer's not spending enthusiastically versus what we mentioned with urban i do think that target has to -- they'll get it on track. when i say get on track, i mean, they did not do the number and brian, as -- i love brian cornell. it's been ten years. but he didn't do better than the number you know you do the number these days on

wall street, that's not forgiving. they don't forgive that. they say, hold on, did the number give me something good >> thing we didn't get to earlier was sg&a >> walmart's been spending a lot of money on technology, and it's really paying off. there was also a note -- the chief growth officer was saying, we remain cautious in our near-term growth outlook well, they're not cautious doug mcmillon is not cautious. he's not you can say, doug is rose-colored glasses he's not he's a hard core guy so, i'm not cautious that -- obviously, laura albert is not that cautious at williams sonoma urban, not that cautious home depot, a little cautious. where am i going i'm saying that it's varied. you don't want to have a -- williams sonoma is obviously -- they've got the right merchandise. maybe it's merchandise they've got the right price point.

you're seeing some guys being on their game and some companies not being on their game, and that's okay. we have differences all the time it just hasn't happened in retail as much as we're getting. >> we're still going to get to petco and lulu >> we've got -- car hart, tractor supply gap is doing much better they're suddenly in a dog fight. lulu is in a dog fight would have been nicer to know it at $500. >> one of the rare retail names skirting off of 52-week lows on lulu we'll get cramer's "mad dash" and countdown t onitohepeng bell on a wednesday that's busier and about to get busier tonight. you're a rock star. we're all rock stars. oooo look look at my data driven insights, i'm a rock star. great job putting finance and hr on one platform with workday. thank you! guys, can you keep it down. i'm working. you people are (guitar noises).

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take a look at some s&p gainers this morning adi is right at the top with a beat, revenue ahead. q3 sales above, talks about inventory stabilizing, jim that's going to be a new all-time high. >> and it will move texas instruments, too, which sliced right through $200 >> along with tjx, which we covered retail just a bit. opening bell is coming up in four and a half minutes. don't forget, you can catch us

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it's time for cramer's "mad dash" as we count down to the opening bell >> highest luxury, billion dollar homes, and they say the order growth exceeded the consensus estimates. everything's really good except for the stock has doubled. they have big repurchasing but they are talking about some areas of the country that are a little bit softer. mentioned florida, still good demand, but maybe there's some softness there what happens is that when you have a stock that's this high, if there's any chink, people are going to focus on the chink. i think that toll brothers is doing quite well, but when you see rising inventory in homes, you start thinking, well, maybe they can't maintain that gross margins have been so terrific. i don't want to bet against doug yearley in the longer term, which may be, like, tomorrow, but i recognize that if you have any chinks, it's just -- this is like target. i mean, target's good. and it will be better next quarter. that's going to be great but there's just, you know what,

they've presented some things that i didn't know i didn't know florida had -- don't worry about the florida rising inventory wait a second. why is that -- i thought there was a short supply >> orders were good. pricing was a little soft on the orders >> yes so, look, when we get to a point where there's too many homes built, that's going to take a long time. they just don't build as many homes as we need we're obviously building the same amount of homes as we were when our country was half the size but the great home builder stock rally isn't necessarily over but this is what the fed should be seeing. oh, take mortgage rates up a little, get a little inventory build, maybe home prices come down home prices are up since 2019. it keeps going the fed's way if i were a fed governor or officer, i would be saying, i have nothing to say. then, it would be so great just shut up you're like babbitt. go to a different club every day and say something.

no it's going your way. let the fed chiefs speak just because you're -- i remember i used to handle the finances of a governor of the fed, and i said, why don't you speak publicly he said, we have someone who runs the fed and i said, well, don't you think you could offer advice he goes, we're supposed to have many voices? talk about visionary can i just say he was by far considered the biggest intellectual at the fed, and i think what's happened is we have discordant views of the fed, and it's like they really want to be somebody you know what? go get livenation and do a show. don't be somebody. we have a fed chief. let's not take away from his view by being -- by having a cacophony of talk. >> waller did say yesterday, he told on our air that inflation will have to bite to bring inflation down with that said, refi's 20-month high this week as the 30-year fixed goes to 7.01%.

that's a seven-week low. >> look, if there were homes to buy, it would matter we need to see inventory we need to see, of the existing home, we know from home depot and lowe's, the fix-up costs too much money of the new home, costs too much money. i hear that things are down a bit, but what we really need, as long as we have everybody with a job, there's too many people competing for a home, and i just -- i want to see that inventory build, and i don't -- i still don't see it like i said, everyone looks at anything, any chink in a stock like toll, which has almost doubled, but i need to see an inventory of homes, in the same way we need to see walmart come into the home business we don't have anybody. no one wants to cuts prices. there's too much demand. >> right but doesn't that make you optimistic about inflation we're already printing, basically, a target without owners equivalent rent >> that's exactly where i am i'm saying to these fed people who speak, go look at the data before you talk. look at the up-to-date data.

look at the individual companies. walmart -- walmart is not anecdotal. costco is $130 million walmart's double that. you've got -- walmart has big international, too you've got to look at what the companies are saying, not the aggregate data, because the aggregate data is often wrong or late if i were fed governor, i would say, we got really good news from walmart and home depot. but they'll never mention a company ever they're almost anti-empirical in the way that they speak. therefore, they don't have the rigor that i expected. >> a lot of it is very qualitative. >> they shoot from the hip if i want to shoot from the hip, i would be anthony edwards >> that's the second day in a row with that joke >> he's the next michael jordan. that's why nbc ought to get the contract okay because when you get to the playoffs, it's dazzling. for the first 80 games, not so much >> right jim, we mentioned adi leading the s&p here, but on semi,

qualcomm, they're all in the top 20 >> we've been waiting for vincent roche -- he's really good, the ceo. "we believe in inventory rationalization across our broad customer bases stabilizing." what does that mean? you've got that same language from sanjay at micron last year when the stock was $70 you got the same inventory -- well, just call it almost double analog is an internet of things kpa company, which is industrial, but look -- see, he made the call that things have rationalized, and there were a lot of people -- >> you gave him props when he sat here the other day >> i love him. the other day, we saw a hapless analyst, who's a really good guy, say, look, i got to capitulate you have to heed the thunder when you have this call of inventory rationalization. what that means is there's not

enough inventory we can raise price imagine if you go to costco and find out there's not a lot of toilet paper, they can raise price on that kirkland signature. they can raise price on what a lot of people think is a commodity. it isn't adi is a really great company, but texas instruments should be up ten points right now. they're the rival. >> speaking of inventory, you mentioned williams-sonoma where inventory was down 13. that's been a running theme in these specialty retail reports as well. >> except for rh, absolutely laura albert came to san francisco when i was -- i did a show the stock was at $200, she reported great numbers, and the stock was immediately cut in half she and i were baffled what happened is that people were saying, we're done with fixing up our home because of covid. we fixed it up we don't need williams-sonoma. what they forgot is williams-sonoma is selling things williams-sonoma always has different things, regardless of whether you're doing your place up or not.

i was at west elm the other day. there's a fashion element to what she does. she is so lowkey and nonpromotional, i have begged her to come on and go to a store, because the stores are looking fantastic. but she just says, look, we're digital first. come on. but i think that anyone who goes to the river -- like we will, the river outlet out on long island, you can't believe. give me some more damaged boxes. this box is damaged on this espresso maker she says, don't worry about it, the product itself is not damaged. my wife says, are you really texting the ceo? >> don't pull that card too much one last bit on retail is shopify, goldman going to buy, $74. >> harley deserved that. they had the story when we had harley finkelstein on, they said, don't worry about it goldman said, they're spending more money that wasn't self-evident now they're spending the money and getting results, and i like

that i like this call because this stock's been crushed, but a lot of the consumer product companies still use it, and their deal with amazon is very positive amazon likes them, which i always think funny, but amazon likes to be -- they're a big tent company, even as there are elements of our government thinks they're not notice how i did that? >> on that point, jim, this report that kate rooney brought us on -- actually, it was out of d.c. -- on the cfpb and affirm and all the buy now, pay laters. >> i thought that was hilarious. they want to regulate it like credit card. it's not down a lot. affirm deserves a little better. when you have no fees, why should i regulate you the same as someone who has fees? that doesn't make sense. >> we had max on, and he repeated his longstanding argument that they are smarter about delinquencies and chargeoffs and weakening consumer balance sheets than we

think. >> they are. and they have the algos. what's interesting for when i had max on, max levchin, is that their dlelinquencies are going down they are the higher price spread they do a great job. today, we had a bank of america note about bangks >> that's where i was going next takeaways from the jpmorgan investor day street high on goldman will be now $525 >> goldman, i saw that and i said, geez, this is just a -- how about david solomon going from being someone who was, like, i don't know, to being the guy everyone's looking to and i have a theory on why that is the people who have left goldman have shut up and stopped bad-mouthing him i don't get that call anymore. >> they're no longer complaining about the stock? >> i said to david solomon, i see you playing records. he goes, are you seeing in your garden constantly? what is that about i said, whoa, guilty

but he has gotten away from the dis and i'm planting this weekend. sorry, david, i got the edge on you. the people who bad-mouth him, i would love to name them, but i'm too much of a statesman these days, like jefferson if not adams. either adams >> goldman was underperforming the s&p until about mid-april. and then, it just took off like a rocket >> well, i always find, say, investing bank momentum continue give me an equity offer if it's continuing that reddit deal was very good morgan stanley deal did great. will we hear tonight, a.i. could redefine industrial cost structure, productivity is real, other than jpmorgan, which has spent a lot of money on this, i don't see the great productivity gains. i think the banks are going to have to start pointing out where they are i don't see them >> right we've been trying to get them -- well, jpmorgan did quantify their use cases. >> they're the ones. >> i'm not sure how much that is

worth at the moment, right >> well, if jamie had not talked about succession, the stock would have been up i was like, you know, i was amazed how much time he spent killing the stock. it's like, hey, let me kill the stock here >> what's he going to do, work forever? >> i don't know. i mean, there's -- there's -- i don't want succession. if i want succession, i'll go season four, which i really liked. hey, adrian brody, is he involved that was a killer performance. >> our frank rich, our good friend, one of the great show runners in the industry. >> when he was in college, he was submitting blurbs, and they all thought he was real. he's been real for like 60 years. >> jim, there's some news on tesla. a lot of it involves new eu registrations now at a 15-month low. >> ugh >> adam jonas and morgan stanley, this line caught my attention. the a.i. theme is taking off even as the ev theme is plumbing deeper depths of disappointment. >> well, i think that we have to

go to the panasonic president, yuki, i'm sorry if i mispronounce that. "our challenge regarding the profit for automobile battery business comes from a huge drop in demand for batteries used in specific models" and then says that tesla has had a drastic decrease in sales. i regard that as very important because it's indicative of the whole pastiche that is tesla i don't want to buy -- i don't want to buy it for a.i., because if i want a.i. from tesla, i'll just go buy -- i'll go buy nvidia, which is the a.i tesla stock was up big the other day. but remember, when musk said, listen, i guess i have to use nvidia -- no one wants to use nvidia because then you have to get in line. >> sure. well, but jonas's point, and he -- by the way, he does reiterate an overweight -- is that auto companies tend to find a way to follow a theme. and he would argue, i think, that gm and ford are undervalued here >> i'm worried that gm going to

get hit by tariffs from china. gm is a very big business in china. they do tariffs, not so good >> on a day where the chinese do float through the china chamber of commerce some 25% tariffs on u.s. and eu cars >> yes i just think you have to understand that europe is very mixed here, very complicated, because 17% of their cars go to china. and no one -- they don't want to get hit by a tariff there. look, i wonder, by the way, if nvidia will talk about china tonight and what they can do, what they can't do, because they have, you know, kind of chips that are not as strong for china. but i think the story's going to be, look, we're sold out for as long as -- we're sold out. i don't know many companies that have a product that, before chips, is sold out that's really why jensen huang is so exalted here because that means you can maintain price for the whole product line the price is high. >> your point about china is getting a lot of attention today. there's a big piece about president xi and looking at

personal disposable income under his term versus his predecessor's is well below average. >> yeah. >> lulu today, i don't know if they were going to call that a china story. they're losing their chief product officer. >> the lulu news is disturbing obviously, they're having issues maybe the issues are going to be one day built into the prices. china is elusive we don't -- some guys are doing better than others remember the apple problem, which is that apple, when they report, ends up doing better than all the things we thought were going to happen there are companies in china that -- like i wake up this morning, and we've got this pdd. >> pinduoduo >> it's up 5, 12, 5, but then right after baba, the one thing that we have is the stock market is buoyant over there, and i think as baba comes down, it may be the cheapest stock on earth

but you have to get comfortable with the idea that china is -- that the -- that president xi's become very mercurial. he's not what i had expected from china for the -- i remember when jo was like, listen, welcome, come on he's, like, i don't want you i'm going to do what i want. i'm going to bug you no you got to play the -- president xi's got to play the game a little bit he's not -- they're no longer the single source of additional marginal sales for many companies, because trump and then biden made it so that they weren't. i mean, you know, look, the only stuff that's really getting sold over there that we're making is tyson foods, and that's because we have product safety tyson's been a good stock to own, by the way. >> remember the days where we wondered what baba's aspirations were in north america? those days are done. now we're fielding headlines about layoffs at tiktok, for example. >> i was watching frank this

morning, and i said, wow tiktok geez, i thought they were doing terrific i'm talking about frank, which i watch every morning. when i looked at tiktok, i said, that was supposed to be the hottest thing on earth i come back and say, look, china does not have what we used to expect from china, so they ought to ratchet back what i regard as arrogance. when you go to milan, it's no longer belt and road now, they have made a real stand in the countries that have raw goods. i'm sure if i were to -- in africa, i'd see belt and road everywhere that's their foreign policy initiative they're still doing many things that are admirable in terms of trying to get people from the rural to the city. but they do not act as if they have had problems. they act as if they're on top. no we don't act that way. of course, we self-denigrate ridiculously student loans, you don't have to pay. strategic petroleum, let's sell

it give away that >> one of the names highly exposed to china is mcdonald's interesting piece about the franchise group here in the states pushing back on this value meal proposition >> they were the -- >> there is an annual meeting today. >> they were the reason they couldn't do it they wanted, at headquarters in chicago, they wanted to do it. but the franchisees fought them. i don't know what tipped, but they went against a lot of the franchisees, which is highly unusual. they raised prices too much. they had the $4 and went to $5.50. only popeye's didn't raise too much and that's one of the reasons why rbi is good. well, wingstop didn't raise much, but a lot of that is, by the way, the price of wings went down a lot >> franchisee relations is a classic never-ending tale. >> that's why i like chipotle. no franchises. just unbelievable management, giving stock of the splits going to happen very soon.

that stock has quietly kept up almost 40% this year brian niccol trying to make it so that the managers don't leave, and he's keeping them with that stock split, because he's going to give them stock. you know, this is an unsung nonfranchise story that is doing so well, and we should be talking about chipotle all the time, because they have figured out a way to be able to actually raise price and not lose customers. i don't know maybe it's quality tastes good? >> yes i remember -- remember when they had quality issues years ago, and you put them in the penalty box. >> yeah, but then we went on, dropped to $180 because i was looking at the taco bell comeback and the jack in the box comeback they were very -- they redid a lot of stuff, and brian came in and really just, you know, brian came from taco bell, and i like him so much. he's good. i always thought he was kind of -- likes philly teams, but it's never really clear. >> check bonds today as we're

obviously in a muted range s&p is just down a point we'll get existing homes in about 15 minutes and a 20-year auction at 1:00 eastern time ten-year creeps up back to 4.43%. stay with us

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watch petco here nearing a 30% gain this is the first peak above the 200 day in a couple of years as the company does come in with a narrower than expected loss, comps down 1-2, less than expected, guides q2 in line. >> good. it went be a penny stock rite aide having real problems getting supplies nothing can save walgreens and cvs. thin ice >> petco we should mention small

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instruments. micro chip, only up 8% this year, they will have more of a move that's going to be a breakout move on semi, too, because it has auto so don't forget there's a cohort of semis that has not done well that's ready to accelerate. >> i have to get you on the vix which closed below 12 again, currently under 12 spoke with a piece on what complacency means this days. >> it's a short fall informed would shake people up i'm not looking for that, expectations are high it's disturbing that there's a level of complacency that is shocking at the same time, remember not to fight the fed and the fed is winning. so you'll be up against something that would indicate the fed staying higher for longer, the numbers get better than the fed has to change their status and you're shorter or out of the market that day, that's a peter lynch day, peter lynch used to say, there's a couple of

days a year you have to be in and i would be afraid to react to to the vix and get out before powell says there's three straight months we're getting better but he learned his lesson, saying i'm getting happier. i want him to be happier he's a great guy. >> seems plenty happy. >> i think he's going to get his day. just he has to take his time and not be exuberant and we have to get the other people who speak publically doesn't help anything, unless they want to move up i'm not against pia. >> as for tonight, jim >> i've got cisco get-- i've go sysco. one of the reasons walmarts is doing so well, it's too

expensive to eat out and then everyone wants to know what happened to snow flake. find out if you watch the show tonight. >> wow that was -- >> yeah. i feel like when i used to run the 220, 440 and the relay >> more squawk >> and then i threw up after the race. >> see you at 6:00 p.m., "mad money" dow is down ten.

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good witednesday morning welcome to another hour of "squawk on the street" i'm carl quintanilla and sara eisen at the stock exchange david faber is on assignment we await nvidia tonight.

dow down 4 points s&p 500 hanging on to 5322 and semis we'll keep an eye on today. as for treasuries getting some housing data today as we continue to weigh waller's comments ten year around 4.43. three movers we're watching target shares are plunging, reporting the first earnings miss since november 2022 much more on the target story ahead on the show. an loalog devices rallying. and speaking of chips, nvidia getting ready to report after the bell today the stock is up 10% this month going into the highly anticipated results. we mentioned the housing data let's get existing from diana olick this morning >> reporter: existing home sales in april dropped 1.9% to a rate of 1.4 million units that's a

miss street was looking for a gain to 2.5 million, sales down year over year these sales are based on closings, mortgage rates jumped at the start of february and held around 7% the next two months before moving higher in april. on the bright side, inventory rose 9% month-to-month up 16% from the year before still just a three and a half month supply because the numbers are still low. the supply of homes priced over $1 million is up 40% year over year tight supply is keeping pressure on the prices. the existing price in april was $407,600 up 5.7% the realtors did say they expect prices to ease as more homes come on the market we haven't seen it yet 33% of sales up from 29% the

year before. all cash still a high 28% of all transactions sara, back to you. diana olick, thank you as far as what the market is talking about with the fed, with inflation, with the overall picture. you know, the christine lagarde, president of the ecb commented in an interview she did in ireland last night stood out because they are in contrast to the message from the fed president which is we have to wait and see about more progress on inflation before we cut rates. listen to how the european central president is talking about it. >> the focus that we have for next year and the year after that is really getting very, very close to target, if not at target so i am confident that we've gone to a controlled phase >> they have another meeting in

about two weeks. sounds like she is gearing up for a rate cut so she feels good about the progress of inflation. >> the phrase really confident does get your attention. we mentioned uk cpi throwing cold water on the hopes for early cuts. >> a little bit hotter but so far the data in europe is good, germany is more worried about inflation than the rest of the euro zone so that's a historical thing. the other thing, i don't know if you've been following these polls we've been getting in surveys about how americans are feeling -- >> i can't with the harris poll. >> let's do the harris poll. >> it's crazy. >> the guardian did a commissioned harris poll for americans and how they feel about the economy. 55% say the economy is shrinking. 56% say the economy is in recession. which, you know, we know on cnbc is not the case. >> well, 49% believe the s&p is down for the year.

which seems incredible >> which it's up about 13% and 23% last year. 49% also say unemployment is at a 50 year high in fact, unemployment is at a 50 year low, or near there, under 4% 72%, i think this is the expla explanation, 72% say inflation is increasing. and inflation is increasing, 3 to 4%, not 9% where it was in the post covid peak but the complications around how americans are feeling with inflation clearly are weighing on their economic outlook. it doesn't bode well for the biden administration >> or anyone running for office really if you're -- i mean, the reaction this morning is largely about an uninformed electorate in general and whoever is in power is going to have trouble delivering a message if americans are going to be -- this is not shading. this is things that are just not true whether the s&p 500 is negative or not for the year. >> i think what is true, though,

is that inflation is high. and it's high relative to where we were a few years ago. and i think it's-- it's a tale of sectors and it's rlumpy and high income is feeling better than low income. and interest rates are increasing loans overall macro data has been good but it could be an explanation why people are feeling crummy about the numbers and people having jobs. >> the messaging is a green arrow or red arrow what do you want it's not a question of what you want to believe. that's why the poll is so stark. >> yes the federal reserve has the annual well being survey they put out and that found 72% of adults said they were doing okay

financially as of october 23rd that sounds okay but down from 2021 and the lowest rate from 2016, showing that inflation is still front and center as far as a concern on well being and making emergency payments and that sort of thing so that's a more sort of less shocking report card and then you get the commentary from the companies, right. and most of them have been a little bit more negative on the consumer side. although resilience is still the name of the game urban outfitter ceo for instance, listen to how they characterize the consumer. >> they are currently in good shape, enjoying solid job security and incomes that are rising slightly faster than inflation. they are still excited by our new fashion offerings and traffic in stores and online remains strongly positive. but the purchases are slightly more considered than last year

>> and then there's target which came out this morning, stock is down sharply. i did have a chance to speak with the cfo, who's a also taking on a big operating role as well in target about what he's seeing from the consumer. there's still pressure on the discretionary spending and items but he said there were stronger discretionary strategy trends, apparel was negative low single digits which is better than the quarter before, one of the reasons he has confidence projecting growth in the second quarter. he said the negative comps was half a decrease in traffic and half a decrease in basket. inflation he said was getting to a more normalized place so that should bode well for the consumer as far as what else they think is going to drive growth -- by the way he said no big change from last quarter to this quarter in terms of the consumer health

they think the relaunch of the circle program, their loyalty, is going to help inflation in food and beverage has been pressuring the consumer and higher rates are on consumers' minds but we've seen a resilient consumer some people are worried about the pressure on margins given the fact they're focussing on value. he said we haven't changed our guidance for the year. they're finding other efficiencies to deal with the profit side. margins higher than a year ago but clearly the sales decelerations, especially compared to walmart last week, something the market is going to be focused on. >> they do point at things as you were saying lower confidence, higher credit card balances, less consumer certainty. and the shift of spending to out of home entertainment with something they drew attention to. >> the categories vary, beauty has been a stalwart for them that he said was a decade trend working well in their favor and

looking at their private label brand as people are more value seeking trying to offset electronics, home improvements, those categories that people haven't been spending lately joining us is oliver chen. what do you see as the disappointment here and why the stock is reacting this way >> great being with you and carl consumer discretionary softness is the headline here in terms of the weakness of the traffic and the need for target to achieve positive comps. so comps were negative 3.7, they were positive 3.8 at walmart we think walmart's business focused on value as well as grocery benefitting walmart. the big issue at target is home, apparel and hard line, about 50% of the business. and the consumer is very mixed and looking for bargains, looking for vaulue.

targets intensely focussed on that, expectations were fairly high in terms of the fundamentals, this quarter they missed on sg&a and guidance was reiterated we have to see if comps can turn positive. >> they're put ago lot of faith in that forecast, 0 to 2% comps for next quarter fidel key mentioned it on a call with me numerous times i think they feel they can do this the question is, is it enough when they're being compared to walmart right now? >> what the company really needs to do and they're focussed on at target offering a deal value, 400 new products under $10 and launching lots of new products at $10 or less, 2,500 products so really pushing on value, making sure the consumer understands that and getting traffic in the stores. target tends to be great at seasonal moments but it needs more stable traffic.

further more emphasizing the marketplace as well as digital advertising. walmart has had a better time in terms of getting higher household income customers that's a big positive for walmart so we'll see but it's a consumer discretionary focused retailer in terms of target that's why it's been more vulnerable because, as you mentioned, the consumer is at a cross roads the consumer is feeling really mixed despite low unemployment and despite nominal wage growth which is outpacing inflation. >> how do they do that the announcement of lower prices on 5,000 items may help. but you're right walmart is getting the benefit of the higher income consumer trading down and target isn't. >> i think home, hard lines and apparel fortunately seeing better trends in apparel, meaning less negative but still negative home and hard lines are other categories that need to work better the consumer has to feel better,

hopefully interest rates are going to be cut on the horizon, that will be a positive for growth too looking at macro indicators around home and home formation given the exposure target has. at the same time what's in their operational control being fast, convenient, drive up, digital advertising, they have to do a bit of everything but product innovation as well as their own brand portfolio those will be important changes they're making as well. the biggest change overall is emphasizing value. shoppers don't always recognize target for value so that will be important for them to both execute on it and have customers recognize they have value. traffic is the formula getting more consistent traffic is the formula for growth here >> so you're on hold at 175, i think, which is now sharply higher than where the stock is right now. what would change your mind? >> we're looking at this, we're

hoping that the strategies will take hold and really yield positive comps our top ideas, sara are walmart, costco and ulta, we're big bulls on the beauty category with ulta and walmart as a technology company and costco is a software model with membership revenue and globally focused on value. the other part of this strategically continues to be bifur bifurcation, louis vuitton is a pick as well the ability to raise luxury prices exists there. that's how we're thinking about it target got less expensive today and hopefully expectations are more 340d rat given the print we saw today, which was cautious. >> oliver, thank you for joining us and weighing in. >> my pleasure. let's get to the biggest stock story of the day, nvidia, gearing up for earnings after

the bell kristina partsinevelos is here with more and what investors need to focus on what's at stake for tech in the market overall >> it was only what a year ago, q1 for them, 2023 when you saw the average market cap was $750 billion before blue pass expectations and sparked that a.i. rally we have now since then nvidia has beaten the street estimates by an average of 20% over the last four quarters in 2023 if you want a number to pay attention to this earnings season, look for q1 total revenues of 24.6 billion at least. buy side saying 25.5 billion on the right-hand side of your screen the narrative was going to be about sustained demand, especially gpus and headed into the following two quarters where some may argue there may be a demand lull air pocket before the next generation gpu comes out.

expect jensen huang to argue that it's growing. other big drivers would be the use of gpus for inferencing large language models, the second step you train first and then the inferences part you spit out the answers to your queries. but all of that cap x spend for microsoft, google, aws, meta, 46% higher than compared to mast last year that means dollars in jensen's pocket. they have an 8% swing. devil's advocate, last year in the summer, nvidia blew past earnings but the stock went down and that it had a run up to earnings so a similar set up to today. there could be some volatility post this report >> have you seen any clues as to what the quarter might look like given the commentary out of

amazon this week about this piece or anything else >> there's quite a bit of drama just because amazon said they're not halting orders of the grace hopper chips there's one particular project taking those gpus and schhiftin it to the next generation. but still buying across the board. but that's what amazon wanted me to know, everyone to know, they wrote, made sure i got the correction from the ft story and the reason for that is that nobody -- i shouldn't say that, nobody wants to look bad headed into nvidia earnings and they're pausing right now either i think the interesting thing when i mentioned the cap x spend that's important for viewers because last quarter 50% of nvidia's data center revenues came from cloud spending so that's why we talk about this number so much i wonder longevity, our investors how long are they going to weight, though, for that revenue monetization to show case itself amongst hyper

scalers or will the hyper scalers and other corporates stop spending. you're listening, you know, talking about -- >> what's the return on investment >> easier way to say it. it's a good question. >> i just wonder the patience of investors. >> right now they're excited about it. >> right >> and why people think it's a bubble my question is how much nvidia is a barometer of anything. >> you can't run the a.i. systems without nvidia products right now. so they're the go to so if they're going to show case there's continued demand for the next several quarters that's going to bode well for tmc, marvel, broad com, it is a good bah rom terfor the rest of the market. >> there's also data center build out and overall r&d cap x. >> it has become the ecosystem

even though they're so far ahead. kristina partsinevelos, thank you. our road map for the rest of the hours, new numbers on tesla's growth in one of the biggest markets. we'll discuss the future of the ev maker with a former insider. and existing homes missing expectations for the month of p april. and amazon getting ready to hold its annual meeting and big news on a.i. efforts aadhe of it "squawk on the street" will be right back don't go anywhere.

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watching the tech sector trading at record levels around 10% since the start of the month. so far the biggest gainers are a.i. plays, micro and nvidia plus chip names. another name in the group to watch is apple looking to extend the win streak to eight days, stock looking to move back into positive territory for the year. it's up again. turning to evs tesla seeing a bit of weakness over seas with the worst month for eu sales since 2023. china xpeng driven higher. a chinese monopoly in the market could threaten the security. joining us is john mcneil, former president at tesla and

presently a board member at gm and lulu thanks for coming in. >> hi, carl. >> what do we make of the registrations telling us something about the market or company or share >> it may be a picture of what's to come. in the eu you have a lot of competition. and so, really the only ev choice in the u.s. for years has been tesla and the eu you have a bunch of alternatives now from the big makers and they're gaining share against tesla. you see tesla's registration share is down. so tesla is losing share in that space. >> is the difference the competition from china in the eu >> there's some competition from china in the eu. clearly byd is there in a big way. but it's also strong competition from the european and scandinavian makers including volvo. >> do you think it's price rice it's price in the lower end of the market for sure because byd has options that are really

popular especially in countries like spain. >> what happens now in light of a quarterly call that elon said if you're in the stock for being in the car business you might want to look elsewhere he means that. >> i think he does he's going all chips in on autonomy i think he sees that competitive battle coming and the battle may not be evs in the future maybe shifting to autonomous vehicles or avs. >> what happened to the ev future >> it's alive and well, a $70 billion business already in the u.s. and combine the new car ev sales with the used car ev sales in the first quarter, remember hertz unloaded tiens of thousands of evs on the market, used sales went up so you have significant ev demand that shifts, rotates back to new car, new ev demand as that -- >> you think so, because there are questions -- >> there are questions but ev demand was up again in

april. that doesn't include the used cars so once the used cars dry up, that demand will rotate back to new. >> can we ever do evs like they do in china at the same price point and quality? >> it's really difficult because there's about $28 billion of subsidies into the ev market in china by the government. so free factories, interest free loans and very low cost labor so it's difficult to compete at that price level or cost level from the u.s which is why it's really important, a lot of people believe, to protect the u.s. manufacturers from them. >> there have been a lot of -- goldman did a report a couple of days ago looking at purchase intentions among ev buyers and tesla is rivals. do you think there's something with the brand >> clearly a lot going on with the brand. about 80% of tesla sales came from very blue zip codes so

there's a rotation coming out of that demand to other makers. so i think there's a lot of a brand story there, somewhat of a price story but a lot of a brand story. >> can you talk about what optionality exists at gm regarding the ev business? >> it's nice at gm to have both options, the ice business funding the transition to e.v. on the ev side they've got -- evs in the 20 to $30,000 range, 30 to $40,000 range just coming to market literally this month and so now we 'going to see a real alternative after tax incentive you have $29,500 equinox that's a really nice car. and a lot of us have been driving it and fell in love with it, 310 miles of range for that price. >> on the charging network in general, does tesla's de-emphasis of that business mean there's going to be range anxiety as a result?

>> that was a head scratcher letting that team go on a critical piece of tesla strategy but the u.s. and foreign manufacturers have come together to form their own supercharging network and they're now rolling out superchargers. you see a shift from tesla building that network to all car companies building that network. but we have to get ahead or at least catch up to demand so we can offer that charging everywhere. >> does the industry expect any changes if we do get a change in the administration after the elections or change in congress? given the ira, the emphasis from the biden administration on evs? >> there's a lot of, i think, have thought about that and really close watching what's going to happen with the control of congress and where that nay go we have, through the ira have had significant movement of bringing the supply chain for evs over to the u.s. in a way we weren't able to do as just tesla

alone. >> so if the ira gets reversed or walked back at all, does it change gm's strategy >> i think we risk losing the manufacturing share to china, we do globally. so it's a bipartisan discussion that ought to be had for sure. >> yeah. a lot riding on the auto cycle at the moment. >> absolutely. yeah. >> john, thanks for helping us understand a little bit more. >> you bet. after the break we'll get the latest fed minutes later today amid new discussions amid multiple rate cuts versus the potential of one cut we'll discuss that next. don't go anywhere.

investors looking ahead to today's fed minutes. steve liesman is down in d.c. after that day with waller yesterday, steve. >> i want to get to that, because comments from fed governor waller and other officials pushing ahead expectations for potential fed rate cuts into the fall and raising questions about how high is the bar for the fed to start

reducing rates waller was dovish when it came to comments on april inflation saying back on track, excited about the idea there was weakening in the economy but here's what he said about when rate cuts may happen. >> if the data were to continue softening through the next three to five months you can think about it towards the end of the year >> so not multiple cuts this year maybe one or a few. >> depends on the data. >> it has to be consecutive and show progress. >> it has to be confident. >> doubts about summertime cuts creeping in, just a 22% chance of one in july and 7% in november and you have to assume stocks are incorp. orating the change you can see they've fallen down for july, september, and

november as well even after the better inflation data both waller and fed chair jay powell talked about cuts as a process raising the question whether it's higher for multiple cuts or say just one but that could depend on the rate which inflation slows. steve, goldman made note of waller's comments but still sticking with july i wondered if you saw modelling 150 nfp for may and if that's near consensus. >> i have not looked at the may numbers yet, i have a couple of weeks before i have to worry about that take one thing at a time but there is an expectation that jobs will slip 150, though, the question you ask yourself, carl at the beginning of the year talking to waller, said look, 23 was the story about supply side improvement bringing down inflation. 24 is going to be about weakening demand or increasing

slack. so 150 that does not come along with a higher unemployment rate may not be creating the additional slack they'd be looking for to try to bring down inflation. >> i mentioned earlier, it's a sharp contrast say from the seb right now, president lagarde saying they're set to cut rates in the next two weeks. >> tattershere's two parts to tt story, do you want to be investing in the place that cut early. their economy is flat and ours has done better. part of the reason is the stimulus from the government do you want to invest in a place where growth is flat the central bank is cutting or where growth is doing better but the central bank is higher for longer?

>> it's why the euro has been so weak that's for se.ur thank you. steve liesman. still to come, getting you ready for nvidia aiming for a second straight record close ahead of tonight's earnings. don't go anywhere.

. welcome back i'm seema modi with your cnbc news update. spain, norway and ireland will formally recognize palestinian statehood next week the designation is a blow to israel as it faces growing international backlash over the bomb bombardment in the gaza strip. the republican national committee headquarters was briefly under lockdown this morning after being sent two viles of blood the hazmat team was called out to deal with the package a tennessee judge granted an injunction this morning to stop

a sale of elvis' estate. it comes as an investor said marie pressley put up the home as collateral for a loan she did not repay. nvidia closed amihigh yesterday. joining us this morning the harsh kumar, a buy rating of 1050 great to have you back that's your case, the multibillion dollar revenue beat >> thanks, carl, for having me on the show. yes, the last three quarters nvidia has beaten revenues by $1.9 billion on average. and we expect this will continue to be the case we have seen no deterioration and fundamentals we can look at this in two different ways we can look at the fundamentals

and what the stock will do the reality is tech spending remains in intact this is a $420 billion market. nvidia is the purest, largest and best way to play it. the current product is still so loud, although it's gotten better but still loud. the back log for the b 100, which is the blackwell series is building up well the sovereign business has started and the company is moving to system levels hoere. i can go on and on about the nice things about nvidia but everybody knows this so nvidia has to dazzle and shine for the stock to take off. it's flat to slightly up. >> when you say it really has to dazzle, what are do you mean what are the expectations versus your forecast?

>> the reality is 1.9 is a pretty amazing number for the last three quarters for a beat they've got to do better than that for the stock to go up materially from here, it has to be $2.5 billion and dazzling commentary on the back half we know the blackwell, comes out at the end of year. the channel checks that we've done suggest the black well series is amazing and astounding in performance we think the real action for the stock comes in the second half of the year. >> is there any potential disappointment or news around china? because of the export restrictions and everything like that that has been an issue in recent quarters >> that has not been an issue in recent quarters. they had a new chip they introduced, mwhich meets all government criteria. they worked with the department

of commerce and whatever other regulatory agencies and make sure the chip is completely insync with what the government would like to ship to china. >> it's on the list of market catalysts for weeks, harsh we'll see what we get tonight. than thanks, as always. still to come, the ceo of compass joins us to talk about housing affordily abitas buyers navigate through the maize of high rates and building costs. back in just a minute.

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news at the top of the hour april existing home sales missing estimates dropping to nearly 2% with 4.14 units. the cofounder and ceo of compass joins us now to discuss. welcome back, nice to see you. >> glad to be here. >> what is happening on sales in the markets where you operate?

is there a slow down >> seasonably adjusted rate of home sales was down 2% versus the prior month but up 12% versus a low in november whereas 3.7 million as a seasonably adjusted annual rate we're seeing the low end is slower than the higher end the million dollar plus home market increased 40% in april. >> was that the stock market >> it is the high end had a harder time last year one, but yes, the stock market is all-time high and you don't need low mortgage rates if your stock portfolio is at a high the market was down 3% and compass was up 7%. so we grew pafaster than the market >> so what's happening on the rent side of things? that's also been a conundrum for

the central reserve. are you seeing rents fall and when will that filter into cpi >> we're seeing rents stabilize. not falling but stabilize. there's a lag where it takes six plus months to go through cpi. >> it's been more than that in this case. so what's the trend now? >> seeing the plateau. >> plateau on rents? >> yes. >> where do you expect it to go? >> i expect it to plateau the rest of the year but we are seeing a positive trend on the sales side. more inventory in the month of may than has had a price drop, 34% than any time in the last ten years. which reflects that buyers are finally pushing back on the upper limits of affordability. >> is that -- i'm thinking of the journal piece last week about softness in some cities in texas and florida and i think "the washington post" followed with their own report. does that account for some of that where the price drops are happening. >> seeing more price drops in in

the south, florida, florida is driven by the record price increasing we saw in the prior years but also home insurance prices are up 40% year over year. >> we mentioned this year. the -- on the commercial property side, but the insurance picture in florida is tough. you think it's taking a bite out of asking price? >> yes, it is. >> so robert, what is the more -- we've ask you this before but what is the mortgage rate that unlocks growth in this market >> you can ask any agent they say you give me a 5.999 and i'll give you the pre-pandemic praise all over again. anything with a 5 in it we think will make the market explode 6.5 will make a strong market. i would say 6.5 would give you 4. -- 4.7 to 4.9 million homes sold >> we're not that far from 6.5

are with we? are we >> we're not we were there earlier this year to a week but then it went up to 7.5 this month april reflects the mortgage rate environment over the prior two months and that saw a 100 basis points increase in mortgage rates so i wouldn't say it's unexpected. >> do you think the spring selling season happens or will people wait to see if they get the five or six handle before they start even looking? >> i expect the next two months to be better than april because mortgage rates have come down to 7% when they were 7.5% a month ago. >> they say let's at least look. we may not bite but we'll start looking around. >> start looking around. but it is a different environment. we are seeing more sellers now than buyers. it's 16% more inventory come on the market and 40% more in the million dollar plus home market. with buyers pushing back and record price drops we are now

seeing more sellers. >> record price drops? >> yeah. right now the inventory sitting on the market, 34% of it has a price drop, which is more than any time in the last -- >> maybe it's not enough to bring in the buyers. >> maybe it's not. so sellers who are priced in this environment, it will sell quickly. but if it's not, it will sit on the market, then you're going to have to have a price drop, buyers will see you have a price drop, and then it will hurt you even more. this is the time to hire an agent. >> a conversation. >> now over 30,000, the best agents in the country. >> so you're hiring in this environment? >> absolutely. >> because it's a tough environment. and some people think that ai can automate a lot of this stuff, the back end stuff. >> we've been building ai for over five years. so what we call ai is artificial intelligence, to empower

intelligence to help them give the best advice to their clients. we have tools like, likely to sell, which helps them look at everyone in their crm and make recommendations in the crm o who is likely to sell based off of a number, how long they've owned the home, what the price appreciation has been in that neighborhood and other factors we have ai to help make recommendations to agents on pricing properties and so what is the standard cma valuation, but what adjustments would they make based off of ai for the standard >> if it cuts down on the junk mail, that helps >> robert raskin as we go to break, check out some of the biggest laggards on the s&p today. target will lead you along with freeport as we do see a little bit of softening and copper, lulu, of course, on the departure of that chief product officer, one of the rare retail names close to 52-week lows. stay with us pillow with a speaker in it! that's right craig. a team that's highly competent. i'm just here for the internets. at&t it's super-fast. reliable.

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and they're all coming? wthose who are still accewith us, yes. grandpa! what's this? your wings. light 'em up! gentlemen, it's a beautiful... ...day to fly. we're about an hour away from amazon's shareholder meeting. meanwhile, sources cnbc that amazon plans to unveil alexa ai features later this year our kate rooney has new reporting on that. >> so amazon plans to give alexa major updates and to add a major

subscription to offset some of the costs. those sources tell me the company is planning to unveil a new version of the decade-old voice assistant later this year, which would potentially position alexa to better compete with this new generation of generative ai-powered chat bots from the likes of what we've seen from open ai and google, for example, sources tell me it will not be a part of amazon's prime subscription and the price hasn't been decided yet. amazon was an early mover in this voice-driven task areas, really wowing consumers with alexa's abilities back in 2014 but those capabilities haven't kept up with the leaps in artificial intelligence, recently last week, both openai and google announced new versions of their chat bots, which can have two-way conversations and both go significantly deeper than alexa. people still mostly use alexa and apple's siri with setting a kitchen timer or announcing the weather. people tell me that those new ai chat bots have increased pressure on the alexa division

internally, which announced significant layoffs last november a source close to ceo andy jassy also telling me that he has been privately frustrated with some of alexa's current capabilities. amazon did not comment on these updates, but tells us that alexa is still a priority for amazon, pointed to the annual shareholder meetings where they call alexa one of their substantial ai applications. >> your report was a big topic of discussion between me and jim in the 9:00 a.m. his point is alexa is deserving of an upgrade. kind of points to the checkered history, the head count, and executive shuffling within that division at amazon, really over the past few years >> carl, that's a great point in terms of the executive shake up. jassy took over from founder jeff bezos in 2021, and bezos, this was really his pet project from people i'm talking to and sources that work there and say that he really was a focus internally this was something that they were able to spend really endless amounts of money on to make work, because it was such a

priority for bezos that has changed a bit there's been more cost discipline, belt tightening across the board at amazon, but it's become less of a priority, at least if you compare it to the bezos era. that it in some ways is a result of cost cutting across the board. but it speaks to the transition and ceos and this being a new era for amazon >> one of several annual meetings today kate, thanks so much kate rooney. tight range remains as wawt e ai nvidia tonight "money movers" is next

good wednesday morning welcome to "money movers." i'm sara eisen with carl quintanilla live on the floor of the new york stock exchange. today, another record high for the nasdaq jeff degraf on a, quote, fail-safe sign that stocks will likely continue trending higher. >> and why vince reinhart says investors are wrong about a september rate cut >> glenn kelman on when to expect relief in the housing rental markets >> first up on stocks, we're a little bit lower right now the s&p kind of unchanged, so is

the dow.