that. it's a difficult situation. >> okay, megan, thank you. >> okay. quick final check on the markets. dow off about 12 points, nasdaq off 33 points. the s&p 500, off 6. when we open in about half an hour, we want to wish everybody a happy independence day, july 4th. watch yourself with those firecrackers. >> worried about the dogs. >> worry about the dogs. join us on friday. we will be here. "squawk on the street" begins right now. >> give them some gummies, i think. maybe me too. ♪ good wednesday morning, and welcome to "squawk on the street," i'm david faber with melissa lee and mike santoli. we're live from post nine at the new york stock exchange. jim and carl have the morning off. we have an abbreviated trading session today ahead of the fourth of july holiday. market closes at 1:00 p.m. eastern. bond markets, that's the stock market, yeah, and we end trading of bonds an hour later. let's take a look at futures as

you see it right there. we are looking for a bit of a down open. let's get to our road map this morning. it does begin with that big tech rally. microsoft, apple, amazon, all at all-time highs, tesla launching its longest winning streak since last july. plus the skydance dance is back on with paramount. shari redstone is back on a deal she previously rejected. southwest airlines adopting a poison pill to fend off activist elliott management. let's start with the markets in record territory and new milestones for the tech sector. great to have two of the greatest, in terms of discussing the markets with me here onset. yeah. you. both of you. >> santoli, for sure. >> and so i'd just love to throw it over, get a sense, mike, as to what your thoughts are. don't seem to be taking a lead

perhaps in the bond market as much as we have in the last two days. >> not as directly. although, yesterday, the bond market sort of calmed down a little bit. yields receded. yesterday's action was really slow in building. late in the day, we got this rally that was led by a handful of the megacaps, and what is interesting, too, is that the laggard among the megacaps get their turn, and that's what has been the story. nvidia was down again yesterday, and amazon, which, of course, has broken through the $2 trillion market cap level, but has really done very little, point to point, for 3.5 years or 3 years, let's say, and there have has this catch-up potential, and of course, apple has gotten this little bit of a move too. and it's essentially been the formula. it's a very split market still. the s&p is up 6% since the end of the first quarter. the median stock in the s&p is down about 1% over that period. so, you still have that critique that it's not fully an all-inclusive rally, although yesterday a little bit broader. some sensitivity to signs of

slowdown. some sensitivity to signs that the continuing jobless claims today remain somewhat elevated, and it creates this friction about, is the fed going to stay more patient than investors can wait? that's kind of the story. >> what we've heard in recent days from fed officials is this concern about the tipping point where increasing joblessness will lead to a higher number. we heard that from jerome powell yesterday. there's that sort of worry, and in that sort of playbook, where you want to be a little bit more defensive, do you still go to the stalwarts in the market? and that would be big tech. you also have to wonder how much do politics -- have politics been playing into this whole thing? i know we're not political as a channel, but -- >> thank god. >> seriously. but as more traders come around to the idea that there could be a trump presidency in store, and there is a prevailing sense that that would be better for the markets in general, i wonder if you then say, you know what, big tech has another sort of breath

of air. >> things haven't gone too badly over the last few years during the biden presidency. >> not at all. >> in terms to the markets. we were talking about the bond market in the sense of a trump presidency, which, at this point, certainly seems more likely than not, conceivably would lead to even more spending, which at some point we could have a reckoning. >> to me, that's where the trade is mostly been concentrated is in the bond market. gold is up. what i find interesting is the standard wisdom going into the initial trump presidency was, you were going to rotate away from the secular growth stocks, and it was going to be about real economy, and it was going to be, honestly, what the market picked up immediately after the 2016 election was, we can have a higher nominal gdp economy. it could be a higher metabolism economy after slow growth, low inflation, because you were going to catalyze with tax cuts and regulation, consumption. the market got there, but nothing worked to the disadvantage of tech along there. yeah, banks did well for a

while, and domestic companies did well for a while with the corporate tax cut, but in general, everything comes back to, well, what are you going to do with these mega cap companies that are basically nation states to themselves and have above-average growth rates, impenetrable balance sheets, and not too many competitors? you know what i mean? it doesn't seem like that's too susceptible to the policy question. to me, it's much more about the way it inflamed the fiscal concerns that are really just barely below the surface at any given moment in the bond market. >> right. of course, the -- that will continue to be the case. in fact, the unassailable position, seemingly, of some of those megacaps is even more so now as a result of the capex spending and that they are undertaking, which is simply not something that any of these other companies are capable of doing in terms of forging the generative a.i. future. you know, it's hard to imagine, in some ways, that we're -- that this is going to change, regardless, other than, perhaps, the regulatory threat under a trump presidency would be

lessened in terms of at least the doj coming after some of these companies and saying, you're just too big and too powerful. >> and their ability to, then, do deals. think of all the deal-making that has just been -- when you think about all these sort of start-ups, you think, who can take them over? it's not going to be the big guys, because the government will not allow that. but in a regime change, could the government allow it? you know, it is conceivable. >> it's hard to know. but that's certainly, you know, when it comes to m&a, there is certainly an expectation, perhaps, that there will be an ability for more consolidation. >> i mean, it feels, in general, a little bit early to really lock into the policy trades, but you can't keep people from doing it. the market's going to try to anticipate, there probably will be turns where it seems like the probabilities shift around, and we remember that from last time where you had the tariff basket and the tariff-immune basket that would trade off against each other. you see solar stocks getting hit, things like that. but beyond that, market is kind

of on its own steam in terms of earnings growth getting where it's supposed to go, skewed toward the upper end and then this question of whether the economy is softening in a beneficial way or that way that we have to be more concerned with. >> right. $4 trillion. we're going to -- some company is going to have a $4 trillion market value before long. >> we're still a 25% move from there, i guess. thereabouts. you know -- >> i know, but nvidia went from 2 to $3 trillion in how many trading days? >> like a month. >> blink of an eye, basically. >> incredible. we talked about consolidation. let's get to m&a this morning once again. we're talking paramount. my apologies to some who perhaps are tired, but it's been a fascinating story. at some point there, will be a movie about it. i would assume it will be done by paramount. we are very close to the end in terms of a deal actually getting signed between the control shareholder of paramount, shari redstone, and once again, skydance and its partner, private equity firm redbird,

which were successful in bringing shari redstone back to the negotiating table after that very much unexpected turnabout of a number of weeks ago where a deal they thought they had done was rejected by shari redstone. what got them there? well, my understanding is david ellison, who runs skydance, would be the ceo of this combination of paramount and skydance. had reapproached over the last couple of weeks, also a lot of conversations, my understanding, with shari's son, tyler, as well, and they got to a new agreement. very similar to the old agreement. in fact, when it comes to the common shareholders, who are probably watching right now, nothing really changes. the only change was the addition of a roughly $100 million in terms of what they were willing to pay for nai, that is national amusements, which holds the control stake, and the addition of another $100 million toward potentially indemnifying shari

redstone if there is any litigation that arises from the transaction and should there be some sort of liability. $200 million more. remember, my reporting from some time back, i talked about the fact they took $200 million out to give more to the common shareholders, so in many ways, they restored that, at least $100 million for the equity and then, as i said, that $100 million in the indemnity fund, if you want to call it that. that was enough for a transaction to be fair that ms. redstone had supported throughout until the last couple of weeks, when they were getting very close to the finish line a handful of weeks ago. the expectation at this point, according to people familiar with the situation, is they will get a deal done by the weekend. could be as soon as friday. we'll see. the special committee of the board of directors now has it. they will obviously be once again reviewing, as i said, the terms are essentially exactly the same as i'd reported them some time back, 15 bucks for 50% of the stock, so that's a premium, obviously. the a shares also getting --

some of them getting taken out. a billion and a half being added to the balance sheet as well. you're talking about larry ellison and skydance and redbird spending close to $8 billion in equity in take control of paramount, half of which will still remain out there once the deal closes, but you will get a liquidity opportunity if you are a common shareholder at a premium. >> so, basically, shari gets more money, and so the deal looks like it's on better footing at this point. >> yes, it was a deal, to be fair, that she had supported throughout. it was a deal that she had brought to the special committee originally and said, i want you guys to review this. that was why it was so shocking that day i joined you on your show that there was that reversal at the last moment. there was some emotion involved there. they seem to have got past that. there is expectations on all sides now that they will get this transaction done. but of course, this is a challenged industry. you're still going to have a very long period of regulatory review in which the buying group

is not really going to have the ability to effect change there, so to speak, and it's -- you got a three-headed office of the ceo. >> bizarre. >> there's no shortage of potential risk here, it would seem. there's going to be a go shop for 45 days, that doesn't matter, but you're going to want an ironclad contract if you are paramount, and that's what the special whicommittee will be ironing out. >> the report that paramount is exploring a joint venture for its streaming business, is that a, in case we remain independent sort of thing? >> it's possible that that kind of a thing will still move forward, at least in terms of potential conversation, but i'm not certain as to exactly what they're going to be willing, at this management team -- now, they're supposed to be independent, to agree to. that said, they have a control shareholder who's selling, so she may say, you can't do that. but there is going to be a need for that. the incoming team, if and when this deal gets done, led by

david ellison with assist from our old boss, jeff shell as well, has a big plan, a big plan for cost-cutting. a big plan for what they believe will ultimately be the ability to actually grow this company. oracle is going to be involved from a technology perspective. i don't know what that means. and larry ellison is there behind it all, a guy whose net worth went up on that day that oracle's stock jumped on earnings, well more, i think almost double what the equity check is here. i think his net worth -- he owns 41.69% of oracle. you can do the math. and so, in many ways, you know, that is something that gives a lot of people comfort here in terms of the ability of paramount to weather the coming storm. that, and their nfl contract at cbs, which still has a long way to go. >> that's true. >> does this deal change, in your view, the media landscape in terms of how these streamers stack up against each other and their ability to withstand this very difficult streaming environment? >> not necessarily, and not

until you start to see what they really do. is there the possibility of a tie-up with max and some really significant way? but we've all come back to the same conclusion, which is, this is a very difficult environment in which to be spending all that money where churn continues for some of these players and the question is to whether they'll ever get to a significant level of profitability, including, obviously, the indebtedness, both at paramount with $14 billion in debt and also at warner bros. discovery, which has an enormous amount of debt on its own. our own company is under pressure because of losses at peacock. if there is an incoming trump administration that looks more leniently on the ability of these companies to get together, perhaps that will change things because there is a belief that you do need consolidation and global scale. >> yep. all right, coming up, we're going to have a closer look at the rebound in tesla shares. this as the company aims to -- the stock aims to erase what were losses for the year that were very significant. only a couple of weeks ago.

let's give you a look at futures. we get started with trading here at the nyse. remember, shortened session. we conclude trading r uiesfoeqti at 1:00 p.m. more "squawk on the street" straight ahead. off the comcast business van. into the vending area. oh, not the fries! where's the ball? anybody see it? oh wait, there it is! back into play and... -oh no, it's in the water. wait a minute. are you kidding me? you got to be kidding me. rolling towards the cup, and it's in the hole! what an impossible shot brought to you by comcast business.

z's baking the house special. arisa's styling a new look. and steve's filling his biggest order ever. with the first ever comcast business five-year price lock guarantee, these business owners get five years of value on gig speed internet and advanced security. all from the company with 99.9% network reliability. so now they can focus on doing what they do best

for the next five years. that's a lot of bread. you got this. the comcast business five-year price lock guarantee. switch today for a limited time. ford is out with its auto sales figures for the second quarter. let's get to phil lebeau, who's got the numbers. >> melissa, in the second quarter, ford sales were up less than 1%, pretty much in line with the rest of the industry, an increase of 0.8% for the second quarter for total vehicle sales, but there are some numbers within the numbers who show where the growth is happening at ford. best truck sales in the second quarter since 2019. also, hybrid sales up 56%. ev sales up 61%. i know some people will say, the ev numbers are coming off a smaller base, but this is critical for ford, and really for all of the automakers, separate from tesla, because as they ramp ev production, they want to see those sales continue to grow.

you see that in the second quarter with ford. guys, back to you. >> ev sales up 61%. i mean, phil, can you piece it together and say that there is a -- there's been an inflection point in ev demand? >> i'm not sure if it's an inflection point, melissa, but we are not seeing the dropoff in ev sales that was predicted in the first half of this year. when things slowed down, we said it, others said it, we said, ev sales are going to continue to grow. they're just not going to grow as quickly in the past, but that was interpreted by the broader market as, oh, here we go, people are pulling back. that's not the case. you are seeing ev sales continue to grow, but just at a slower pace. the expectation is that they're up 10, 11% year over year, and we're going to continue to see that here over the next year and a half as more models come into the markets. >> and phil, i know you were talking all day yesterday about

tesla's delivering numbers, as well as this move in the stock, which has a lot more behind it than the here and now in terms of sales, but what do you think the market is sort of suggesting about tesla's relative position in ev sales? it did seem as the fragmentation in this market had people wondering if tesla was still going to retain as much of an advantage. i don't know if people are drawing connections between ev credits or subsidies with net help tesla or something like that down the road. but what's the read on that? >> well, i think, dave, when you are -- mike, i'm sorry -- when you take a look at what you're seeing with tesla and the numbers yesterday, one thing stands out. the ev business, while it is not growing as it has been in the past, in fact, year over year, the sales were down 4.8%, the market, in terms of the investors, they are focused on the lower priced models that are supposedly coming in the first half of next year, as well as the robo taxi, and that's --

when you look at the ev part of tesla's portfolio, that's what i think investors are focused on. so, they are not necessarily focused on the pure ev sales to you and i alone. they're looking at this next generation of lower-priced models, as well as what happens with evs in a robo taxi world that elon will be outlining on august 8th. >> july 23rd, they're reporting earnings, so those are the two dates in which we may get incremental or additional news, so to speak. >> the july 23rd numbers, david, remember, the big focus there is going to be, what's been the pricing impact in china? we know that they're definitely in the middle of a brutal price war with the chinese ev companies, and we'll get a better sense of that after the bell on the 23rd. >> yeah, well, i was -- we talked yesterday about byd's deliveries, which are -- on just evs, not including hybrids, which are very close to tesla's

at that point in terms of numbers. >> they're nipping at their heels real close. >> phil, thank you. phil lebeau. coming up, an area where some are seeing a buyer's market. stay tuned to find out all about it. let's give you another look at future. we got about nine minutes before we get started with this shortened trading session here. you can see not looking for much right now. more "squawk on the street" when we return. i can't believe you corporate types are still calling each other rock stars. 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). hand over the air guitar. i've got another one.

take a look at the s&p gainers as we get ready to begin trading. we talked about paramount. you can see constellation on there. you like beer? a lot of other people do too. more, perhaps, than wine and spirits these days. 8% net sales increase, 7.6% rise in shipment volumes of beer for constellation. opening bell coming up. don't forget, you can catch us any time and anywhere. follow the "squawk on the street: opening bell" podcast. with absorbine pro,

pain won't hold you back from your passions. it's the only solution with two max-strength anesthetics to deliver the strongest numbing pain relief available. so, do your thing like a pro, pain-free. absorbine pro. here's why you should switch fo to duckduckgo on all your devie duckduckgo comes with a built-n engine like google, but it's pi and doesn't spy on your searchs and duckduckgo lets you browse like chrome, but it blocks cooi and creepy ads that follow youa from google and other companie. and there's no catch. it's fre. we make money from ads, but they don't follow you aroud join the millions of people taking back their privacy by downloading duckduckgo on all your devices today. (office chatter)

is it me...or is work not working? at least, not the way it could work. your people are buried in busy work. and you might be thinking... can ai make it all work? can ai help your people work... without all the workarounds? feel better. make customer service work the way customers expect? that one. make your old tech work with your new tech? thank you. and todd here is wondering, can ai do all that... now? no pressure. it can. on the servicenow platform, ai transforms your entire business. your people work better, your customers are happier, and todd... well... he's practically euphoric. practically. because when your people work better, everything works better. so what are you waiting for? let's get to work. idris elba works here? mm-hmm. ya, he's super nice.

>> announcer: the opening bell is brought to you by nuveen, a leader in income, alternatives, and responsible investing. jpmorgan chief market strategist and co-head of global research is reportedly out. bloomberg is reporting that kolanovic is leaving the firm. he was bullish in much of 2022

when the s&p dropped almost 20%. then, he turned bearish just as the stock market bottomed, missing last year's almost 25% rally in the s&p as well as this year's first half double-digit gains. he's been at the firm for close to two decades. >> yeah. >> so, it's been quite a run as chief market strategists go. >> tough to miss those two calls, though. >> he's been fighting the market, had like a 4,500 s&p target, 20% down from here. on the other hand, that would be, like, 16, 17 times this year's earnings. it wasn't be some absurdly low valuation for the market. i have do think one thing that just reading his work all the time, he really fixated on, first, sticky inflation was basically going to undercut market valuation. now, he's been more focused on things like the ism and the manufacturing pmi-type survey numbers, which really have been a false negative signal for the overall economy and certainly the stock market for a while. and then, if you're a strategist and you don't sort of acknowledge the power of the big

growth stocks and their ability to sfupport the index and creat earnings where they otherwise wouldn't, it's been tough to keep up. i think net-net, everyone is going to be a rush to say, this is a contrarian sell signal for the market. we had the biggest bear on wall street carried out. it happened in 1999 with chuck at merrill lynch. it just seems as if there's lots of push and pull. >> who has the greatest influence these days, if any, amongst strategists? wilson had a great call for a while on stocks being strong, then reversed course incorrectly for quite some time. >> i feel like strategists are not -- it's no longer the days of chuck or abby at goldman-sachs where you sort of put them on a pedestal. right now, we're in a world where strategists change their

forecasts, the markets are increasingly harder to predict. so, here we are. i don't know. >> i think there really is, among the people who do that job, an acknowledgement that the prediction of the index is kind of a fool's game, and they're just trying to give you color around the themes that matter in the market. >> if you can present some faction of importance. here's the opening bell. here at the big board, that's the united states coast guard doing the honors. the new york sector celebrating july 4th, of course. over at the nasdaq, friends of firefighters, a nonprofit providing mental health services for the fd ny. throw it over to both of you, see if there's anything in particular in terms of the market or a particular stock that gets your attention as we get opened here. >> we do have, you know, tesla following through to the upside. i would just point that out in terms of, you know, it's one of those things that it serves so many purposes. obviously, it's sentiment towards the ev cycle, but it's

also this sort of feeds off of that familiar energy at a time when nvidia is on the down swing. these two stocks can't both kind of be in the lead in terms of the buzz and the momentum at the same time. i mentioned earlier, tesla just nosing above its 200-day average, so the trend is still down for tesla, but it's making a bid to have sort of this multi-day move, and we got the hype started on the robo taxi. >> the move has been extraordinary. i remember the stock being down as much as 30% for the year. it's now down 5%. that's a 25% move in a very short amount of time. >> very quick move. >> some analysts are also saying that, you know, as meme stock mania kicked up again with roaring kitty, there's some correlation, albeit loose, with the move in tesla, and the big gain we've seen recently. i think what's most interesting about the tesla move, yesterday, in particular, and the follow-through today is that it's moving big on these vehicle numbers when the bull case squarely says vehicle is not the

big part of the bull case. >> so does elon musk, right? he said, famously, don't even own my stock if you care about that. i'm about robo and about -- >> full self-driving. >> and robots. >> if you're adam jonas at morgan stanley with a $310 priet tart, 20% of that price target is the core auto business. your move of 7%, 8%, 9%, 10% yesterday and today, that's all based on this small part of the business. and you have this other part, which could be catalyzed in terms of 88, the robo taxi, in terms of a move in the stock. that's the anticipation surrounded if you're a bull. if that meant this for the core auto business, which is a tyiny part of our case, then think of the upside when we get that catalyst. >> you have to have an awareness of where it's been. it was a $400 stock. it went into the s&p 500, i mentioned earlier, in december

of 2020 at $231 a share. >> wow. yeah. >> it's kind of -- it's basically sideways since then. massive, massive couple thousand percent gain from low to high in a couple of years, but it has settled down around these levels. >> yeah. should point out, though, it is $750 billion market value. remember, elon musk now, i think, is back to a 20% ownership when you include the recently approved compensation, whatever we want to call it. >> and presumably, he's going to exercise the option. >> i would assume, yeah, but you have to include it in his overall net worth. he's got to be topping the charts again. >> you were talking about larry ellison earlier. you can't -- he has a reportable stake in tesla, but i think he may still own 1% of the company. >> that's a good point. yeah. ellison is -- yeah. >> he's doing okay. >> he's really rich. by the way, you mentioned the meme -- i mean, the chewy thing with roaring kitty earlier this week, $243 million worth of

stock, 6.6%, i think it was. stock went down, though, right? >> yeah. >> i don't know where it is right now. >> it had run up a bit into the actual disclosure. >> on the dog cartoon. >> it's down yet again. there it is. you get a sense for it this week. >> yeah, it's -- it's the classic trading strategy of, you know, you buy the dog cartoon post, and you sell the s.e.c. filing. >> that's a classic strategy. i know. if kolanovic had known that, he might still have a job. >> divergence for novo nordisk on today's session. "usa today" op-ed penned by president biden and senator bernie sanders urging these drug companies to lower prices a and "end their greed" but little lilly started to pick up mid session yesterday on pfull prov

of its early symptom alzheimer's drug. we're seeing follow-through from that turning appoinpoint in yesterday's session. that drug is going to be $230,000 a year but it is probably -- it is seen right now as the front runner in alzheimer's, and it really does underscore lilly's pipeline when it comes to life beyond glp-1s. as much as promise as glp-1s have and their next sagain sort of versions, there is a whole other side of lilly. >> do we know where the government stands in terms of covering an alzheimer's drug for medicare? >> that's going to be a pain point. it always is. when a drug comes out of the gate, when it's that expensive, whether it will be covered. >> yeah, it's sort of remarkable. before glp-1s, this was the main thing eli seemed to trade off, the prospects of these

treatments. it's remarkable that it's now a little bit of an add-in. >> it's like a call option. well, it's not, because it's out on the market but it does put it in the front. it surpasses -- it's viewed as surpassing biogen's drug that's currently on the market. that's an interesting -- but lilly is up by almost a percent, and we've got novo down 1.25%. of course, that ceo is going to be reporting earnings in about a month or so, and then the ceo will be appearing in front of senator sanders' committee in september. >> yeah. >> on the topic of drug pricing. >> i mean, lilly, it should be pointed out, is twice the size of any other pharma company in terms of its -- you saw at the bottom -- its market cap there. little news this morning out of southwest airlines. they put a poison pill in, largely because elliott has a large stake there. not much more to it. it's one year. essentially says, you know, if you go beyond a certain point, you get massively diluted.

if you're just paying attention now, elliott has said or it's been reported about 11% economic interest. lot of times, they build that not just with straight stock but with derivatives as well. and so, they say, plan effective immediately, expires in a year, and in consultation with their advisors, it is, in part, done because elliott has accumulated a significant economic interest, and in light of the potential for elliott to significantly increase the board determined adopting a rights plan to -- is prudent to fulfill its fiduciary duties to all shareholders. they do go on to say they've made a good faith effort to engage constructively since the initial investment and they do remain open to any ideas for lasting value creation. >> it is -- you know, just big picture remarkable that, you know, southwest airlines is now down at a market cap level of $17 billion where it seems like they have to be wary of, you

know, being able to be muscled around a little bit, i guess, even if -- i mean, we're not really contemplating that there would be a bid for the entire company. >> no. >> presumably, right? >> elliott -- >> they just want to make the influence. >> when it has come to tech companies of a certain size, elliott has pushed -- and taken some of them private because they have the ability to do that. i don't believe that was a thought here at all, owning an airline. not a chance. it is kind of odd in the sense of, typically, playbook for elliott, either you do what we want or we're going to threaten to challenge for the board and we'll see what comes of it. but not, to your point, mike -- hard to imagine they would ever take control of an airline. >> remember, southwest lowered its revenue guidance, what was it, last week because of pook boo booking patterns. it's also an airline that's been under the most pressure when it comes to boeing issues. they got a whole host of issues

that they're facing so elliott might be stepping in at a very vulnerable point for southwest at this point. you mentioned constellation. out with earnings. >> we can come back to those as well. the stock is up a bit on earnings. >> it is amazing what the beer category has done for it, and the continued gains and market share that they made after the bud light boycott a year ago now. their beer brands, the maxe mex lagers, they've outpaced growth compared to the whole beer category. >> there's a corona sun brew, a modelo chilada if you want that. it's fresh picante. >> i love picante. >> do you? there's a negro con chile as well. that's what it says here. >> i don't like that crossover. sounds like a lot of --

>> they probably refer to that as innovation. >> i may be reading it incorrectly. >> innovation at its worst. >> wines and spirits is going the other way, and that has been much more challenging, both for the company, which continues to say it's sort of on the right trajectory there, but nonetheless is seeing obviously declines when it comes to wines and spirits, which, quarter to quarter, has been on a steady decline for some time. >> just within the category, within the food and beverage stocks, it just has superior growth. it's got this, like 12, 13% earnings growth path. that's pretty -- it makes it stand out, and it gets the valuation for that reason. it's been one of the stronger stocks. >> yep. our next guest says great first halves often begin more in the second half, especially in presidential election years, but this time may be different. morgan stanley wealth management cio lisa shallot joins us. great to see you. >> good to see you guys. >> you send defensive when it comes to the market's path into the second half of the year, highlight

highlighting a lot of risks, geopolitical, fiscal, et cetera. the lisa goes on and on. >> we're not all that defensive. i mean, our piece was really about what is defense in this market. and so, our concerns are about the lack of breadth, the concentration in the market cap weighted index, and the mag seven. if we're in a soft landing, this should be a market that's broadening out. we think that we are in a soft landing. and i don't think what investors are really paying attention to, quite yet, is the fact that mag seven earnings for the remainder of the year are going to massively decelerate from growth rates this year, quarter over quarter, of about 27, 28% year over year profit growth to something closer to their normalized range of somewhere between 12 and 15%. at the same time, if we're to believe bottoms-up analyst estimates, the rest of the 493 are actually going to see their

profit growth accelerate from year over year comparisons that are virtually flat this quarter to something that exits the year well over 10%. so, we want to be owning the stocks where earnings growth is accelerating. so, what we're saying is, look, everyone wants to crowd into the same old-same old names. that's where the risk is. that's not defense, to own the mag seven at this point. defense is to own breadth, to own equal weighted, to be an active stock picker, to own things like energy, industrial, health care, utilities, health care, all these things that have been lagging the market, and yet are much more apt to put up earnings surprises and earnings acceleration in the second half than the same old-same old names that have led us here for the last two and a half years.

>> you're not saying, though, lisa, to get out of the mag seven, right? it's just to allocate money elsewhere. i imagine it's a hard sell to investors to say, pull money out of nvidia and put it in health care, which has not done well and could be under political pressures. >> absolutely. we're not saying, you know, that any of those names are not decent companies and shouldn't be in your portfolio. we just don't want to chase them at these levels, and as i said, i think that as people see their earnings growth normalize, they've grown into their recovery trend. one of the reasons that the year over year profit numbers over the last 18 months have been so great is people need to remember, tech earnings collapsed in 2022, right? and so, we're going to lap all of that. we're going to have much tougher comparisons, and that year over year earnings growth advantage

that the mag seven had, where they were growing it, you know, over 30% and the rest of the market was not growing, that's going to shrink, and you're going to have a lot more companies putting up very decent year over year earnings growth, whereas the mag seven are going to start to normalize into that 12 to 15% year over year range. >> lisa, is there a way to handicap what might turn investors' focus in that direction? it seems as if the unusual nature of this cycle maybe is keeping folks from really emphasizing those types of ideas, because it would seem like that's an early cycle thing, right? you basically say, oh, we have an earnings recovery story, you can buy riskier financially, you know, lower quality stuff, whatever it might be, more cyclical stuff, and that makes sense. maybe it's when the fed cuts and you've averted the down part of the cycle, but i just wonder how you're thinking about that. >> no, great question. so, i think that there are a couple of things to catalyze it, to your point.

i do think that first is rate cuts. but the second has to do with us putting some reality around the mythology that is generative a.i., right? it's great for these companies to be telling stories about all the great capex that they're putting in the ground, all the capacity that they're building in datacenters for all the software and services that they're going to sell to all the adopters of a.i., but we've got to see that next chapter of monetization happen, and that's where i think the -- that we've got some skepticism. there's no doubt that generative a.i. is an enterprise-wide transformational technology like the internet was. but like the internet was, it is going to take many years for us to actually understand who the true winners and losers are here. and we think that a lot of this

enthusiasm has gotten over its skis, and not all this capex is actually going to have very high r.o.e. attached to it. >> great to speak with you. thanks. >> always great to see you guys. thank you. we have services pmi was out just a few moments ago. let's get over to rick santelli for those numbers. rick? >> yes, thank you, david. these are s&p global, maybe the most important aspect is they're the service sector with the composite and of course we are replacing the mid-month read with the june final. 55.1 was the mid-month read on services headline. 55.3 is the new final. so, it increased by a couple of tenths, and it still remains the best in over two years going back to april of '22. the composite, very similar. 54.6 was the mid-month. it improved a couple of tenths to 54.8, and it also remains the best level, the highest level

over 50, since april of '22. a little over two years. we still have the ism services yet to come. top of the hour, along with factory orders and durable goods. but "squawk on the street" will return after a short break. okay, team! oh, thank you so much i couldn't have done it without you. honestly, i don't do a whole lot here. i'm really just here for the at&t internet, it's super-fast so, any pre-launch concerns? what if nobody buys them? that's mean or, what if everybody buys them? oh, i hadn't thought of that that's probably not gonna happen can we handle that kind of traffic?

the network can handle it! i downloaded eight hours of true crime stories just during our last video call i'm learning a lot

if you haven't noticed, crude is at a two-month high peak. driving season just getting under way, of course, with the july 4th holiday. you can see it right there. having an impact as well as you might expect on the big oils, exxon and chevron last check were both up. we're back right after this. trends?

all that research. sounds exhausting! nope. schwab's technology does the work. so if i spot an opportunity, in robotics or pets, i can buy those stocks ina few clicks. can't be that easy. it is with schwab! schwaaab! schwab investing themes. 40 customizable themes. up to 25 stocks in just a few clicks. (♪♪) car, this isn't the way home. that's right james, it isn't. car, where are we going? we're here. (♪♪) surprise!!! the future isn't scary. not investing in it is. car, were you in on this? nothing gets by you james. nasdaq-100 innovators. one etf. before investing, carefully read and consider fund investment objectives, risks, charges, expenses and more in prospectus at invesco.com the future is not just going to happen. you have to make it. and if you want a successful business, all it takes is an idea, and now becomes the future where you grew a dream into a reality.

the all new godaddy airo. put your business online in minutes with the power of ai.

welcome back. manhattan apartment prices are falling creating what many see as a buyer's market. robert frank joins us with the details. >> the average price of an

apartment in manhattan fell 3% in the second quarter. now only costs $2 million to buy an apartment in manhattan. median prices fell one of the reasons is rising inventory. unsold apartments in piling up in new york, there are now 8,000 apartments for sale. so at the current sales rate it would take about 10 months to sell all of that if new apartments weren't listed. anything over 6 months brokers say signals a buyer's mark. and they are buying. sales jumped 12% over last year, the first increase in two years. more sellers are listing properties and dropping prices just to get deals done and more buyers are biting the bullets because prices are down and rents remain high at $5,000 a month on average. brokers say they expect the rest of the year to be stronger. mortgage rates are not much of a factor in manhattan.

62% of deals in the quarter were all cash, that's near the all-time record. so you don't have the same lock in effect here so you're seeing a bit more inventory free up faster and that's going to drive down prices more in the next quarter and hopefully get some deals done because we had the two-year stand off where buyers and sell es were so far apart on the price expectations now the sellers look like they're coming down. >> are there parts of the market that are more all cash than other parts? i wonder if there's a lock in effect for some parts of the market compared to others? >> yes. about 10 million, 88% is all cash. >> a lot of cash. >> who are these people? >> people with a lot of cash. and below 3 it's something like 35 to 40. >> so the middle. >> really the middle and the bottom is mortgage dependent. the top usually does the best in new york city. right now, the top is the weakest in terms of sales and

prices. i think that has to do with confidence. wealthy buyers have discretion on when they buy. they're waiting to see what happens with the election, interest rates, et cetera. so they're holding off. but the rest of the market is seeing a sales uptick. so brokers are finally getting demand. >> is there some untapped demand we're unaware of or is this going to continue for some time? >> the untapped demand to the extent it exists is in the rental market and that's what is keeping the rents high. vacancy rate and the office market is still low, like we're still half occupied you say who are the rentals. a lot of people are hiding out in the rental market. they're going to come back in and to the extent we'll see how much untapped demand there is. it's new york city. some people love it here and some don't. >> if you love scaffolding you'll love it here.

>> capital scaffolding right now. >> we set records. >> for scaffolding. >> it's gotten a little bit better. i'm a lifer, come on. >> me too. >> robert, great to see you, thanks. that does it for us here. mike santoli thank you as always. >> of course. >> for chipping in. we'll keep a close eye on the markets. the nasdaq hitting an intraday high, by the way. we're back after this.

good wednesday morning, welcome to another hour of "squawk on the street." i'm david faber with melissa lee and wilford frost. we're live at the new york stock exchange. let's look at the markets one half hour into trade. up on all the major averages and that's a new high for the nasdaq. >> we are 30 minutes into the trading session. the three movers we're watching. tesla is driving higher, coming

off the best day since april and on the longest winning streak since july of last week and getting a number of price target hikes including dan ives raising to 275 with a bull case next year. we have more on the trade coming up. shares of paramount are soaring, sky dance has reached a preliminary agreement to buy national amusements, the controlling shareholder in paramount. more ahead on this on the show. and constellation giving up some of the gains after reporting mixed results. we'll bring you the update as it crossed. and economic data today. more crossing as we speak. let's get to rick santelli for that. >> yes, there's a lot of data here. if you look at charts, markets are dropping in interest rates, lower yields and stocks should be doing better. this is weak data, factory orders supposed to come in a positive number, up a couple of

tenths down half of one percent, the second weakest month over month change outside of january, one is minus 2.3. doesn't end there. strip out transportation, it gets weaker, down .7. and both the factory orders and extras were downgraded a couple of tenths from last month, down .7 the weakest. also from january when it was down .9%. durable good orders mid month read remains up .1. noneffects exhair had a whopping down .6 on the mid month read it remains down .6 that's the weakest since september of '22. and orders to shipments down .6 as well these are weak numbers.

services side, the most important part of the economy to many and what the fed keeps monitoring believing if that slows inflation slows. well, it's slowing. some services headline number, comes in at 48.8. this follows 53.8, 48.8 is the weakest since may of 2020. prices paid went down. that's a good thing, from 58.1 to 56.3. 56.3 is the lowest level since just march when it was 53.4. which really does raise a flag a bit. it's going down, that's good. but we've been there done that to a greater extent. the employment considering adp was light, but come back friday for the big june job report, 46.1 on the employment index. it remains below 50. the first month of the year was above 50.

46.1 is the weakest of the year. going back to december of last year. finally on the new orders, 47.3. 47.3. that's the weakest level going back to '22. so interest rates moving down a bit. we're hovering around the 436 level in tens. that's down 7 basis points on the session. david, will, melissa lee, back to you. >> rick, thank you. rick santelli. stocks do continue that record run in the second half, at least the handful of days we've had thus far. the s&p closing above 5500 for the first time ever. the nasdaq hitting a new high today, coming off the 22nd record close of the year. so that age old question we like to ask here numerous times a day. how much more room is there to run? director of global macro yurin

timber joins us. we get started late in theks week with the banks. have you seen any erosion and what are your expectations in terms of earnings as we head into another season. >> good morning. it's interesting that the earnings estimates. are usually drifting lower by now because as we know, companies like to guide lower and surprise the estimates, they like to under promise and over deliver. the calendar year estimate for this year and next year are rising when they normally would be falling. the earning cycle seems to be in a sweet spot here where earnings that drifted lower last year are accelerating higher. so the q2 year over year growth rate estimated by the consensus estimates on wall street are

around 9% and the last two quarters came in lower and had a solid bounce of 5, 6 percentage points. so it looks like the second quarter we could end up with double digit growth which is where the forward estimates for the calendar year are growing at about 12% year over year. so the earning cycle is accelerating which is a bullish under pinning for the market cycle. >> what do you think is more vulnerable at the time moment, jurrien? the equity market or the long end of the bond market? >> i think the i think the market is in a sweet spot in terms of where the rate cycle is. so, you know, i have some models that indicate that the bond market, the ten year yield is at around fair value, 4.25, 4.5, where it should be based on where the forward curve is and the nominal gdp is averaging.

the fed is at 5.38 with a bias to ease, and it has been holding a of you that because it's better to wait too long than to go too early and have to take it back. and the economy doesn't seem to be, you know, hanging on for dear life waiting for those rate cuts to happen. but certainly the core pce number from a few weeks ago gives the fed more margin to maybe launch that first rate cut in the coming months. and then on the long end, i think the days of zero interest rates are behind us. so i think there's a limited amount of scope for yields to fall. even if we go into a recession. and at the same time, you know, we are in an era now, a merging era of fiscal dominance that does raise the risk of an occasional rate tantrum like we saw last fall what we saw in

2022 in a much bigger way. i can't rule out an occasional push towards 5% and the last few times that's happened, the stock market did wobble. i think we're in if an era it's wobbling rates that affect the market. >> finally the a.i. boom i believe you say is really. i think many would wagree with you. it came up yesterday in sara's conversations with powell and lagarde and the brazilian central bank head as well. you know, productivity led growth phase but what about the debt side of things? i'm curious as to your thoughts as well given you included it in your talking points here. >> so fiscal dominance is a big problem of course for the rate markets for all markets, and,

you know, the deficit is currently 7% even though the economy is in a resilient uptrend. and there's really no end in sight for that given where the spending the coming from and how little of it is discretionary. so then really the main hope is to out grow the debt much the way that the u.s. did after world war ii but demographically speaking that's a harder thing to do now than it was then. so then, it really needs to come from productivity. the speed limit for the economy is labor force growth and productivity growth. so if a.i. -- if the a.i. revolution or boom is the great hope that lifts the productivity ceiling for the economy at large, then it gives us a hope to outgrow the debt because if gdp growth is above the growth in the debt, then you avoid a debt cycle. but, you know, we have to see

how it all pans out. this is not an overnight story of course. but it is -- that is something we can pin some hopes on. >> to be continued. >> hope you get to enjoy a bike ride over the fourth of july holiday. thank you. >> thank you. let's get to tesla on the longest winning streak since july of last year aiming for a seventh day of gains. optimism on the streets with a number of price hikes out today. tom is joining us now. great to have you with us. 227 is below where we are right now and you recently reduced the price target a couple of weeks back based on on lower robo taxi assumptions how much of the 227 is robotaxi? i guess you're not expecting much out of the 8/8 event. >> it's about 52% of my valuation is robotaxi, dropped

it from 70%. >> the stock has run up a bit the last week or so, tends to happen with this stock. i doubt the investors who are pushing the stock up are doing the math i've done. i think the delivery number is something that folks are maybe overanalyzing. this is really an autonomy play. august 8th, i think it's important from a conceptual point of view you get these people like me writing the long flowery reports but you won't get meaningful contribution from robotaxi for a long while. not sure how much upside there is in the stock but i like it. >> when you say others don't do the rig yorous analysis, what a you basing the analyst on? others say we've gotten no details on what robotaxi might be or what it means for the company. how do you plug that into a

model that is so fine you can go from a $600 billion valuation plus to 400 something? >> i think the way to approach this, one do a top down look. you say do you believe in robotaxis? >> yes. what is the market size for this? it is enormous. then you try to be as conservative as possible. what's the minimal amount of market share tesla can get? i gave them 20% market share -- >> what is the total addressable in the area. >> of the total addressable -- >> which is everyone who wants a car? >> no. this is who wants private car ownership, people in cities, housing dynamic -- it's a lot of work. so you do the math. the reason it cut from 600 to 400 billion is because i lowered my pricing assessment, because i raised the amount that uber and

lyft are getting there that, because i was underestimating the value from those app providers. >> i'minterested in your take on how far ahead of the curve they are. clearly they were ahead of the curve on evs but pretty much everyone has caught up with them now and some chinese players can deliver evs at a lower cost. can the same thing apply to robotaxis even before it's become widespread and adopted? >> that's why i did the approach i looked at the entire ecosystem. there are a lot of players that are going to play in this. it's like three parts. it's the car, the zasoftware, t app. are going to make the car, a lot of companies will do the software. in terms of them specifically i think that ssd version 12 was a break through event. elon has pivoted the company from head count perspective to terms of pushing out the nextgen facility. now unveiling the robotaxi on august 8th.

it is the game changer and they have the most miles on the road thanks to auto pilot. there are a couple of other companies out there. so there are going to be a lot of players in the ecosystem. all i'm saying is, they will have a big seat at the table. like i said, 20% market share for their walled garden, i don't think that's unreasonable. and only 7 to 8% in europe and china. it's because the overall tam is so big. it's in the trillions of dollars. i'm only saying they're getting 400 billion of this enormous game changing market. >> you say -- the stock has almost erased all of its losses for the year. you say those sending it up are not doing the rigorous math that you do. has that ever been the case. >> and does it matter? >> it doesn't. you have to do the second derivative thinking with the stock. what's important to takeaway from yesterday is not

necessarily the strzokock price the fact that people are capitulating giving up on it. people want to be constructive on it. that says to me people are coming around the robotaxi argument. i've been coming on for over a year talking about robotaxi. if you look at the comments on youtube, this guy is crazy. but recently it's more positive. i think there's a sentiment shift getting more constructive on this is a reality not just me with my tinfoil hat on, talking about science fiction. i think people are getting more realistic. i see that as a translation of the stock move not really that deliveries mean something significant. cars is only less than 10% of the value of my price target. >> what about robots? >> i don't value that. it could be something but i'm looking only at the businesses that they're actually going to do something with. that i believe they can. there's something we didn't talk

about, megapacks, energy storage. yesterday came out -- >> record deployment. >> gig watt hours, last year 100, they did nine in one quarter. they were 50% of the market last year. they're gaining market share. this thing is growing by 80% this year. it's worth more than my car business as well. i don't think many people are talking about energy storage either. >> how much is energy in your price target? >> it's about 15, 16%. >> the pure ev business is what? >> 10. >> car business is less than 10. meanwhile, you have a price target below where we are. >> all i heard from you has been positive, basically. >> with your tinfoil hat. >> yeah i like the show 227. nbc show. i think as we discussed tesla it's more than just a stock price. i think people hopefully will look at the work we've done and see why does he think this about megapacks about autonomy.

i'm very conservative in the car business. valuing it with ford and gm, using 2024 numbers which is probably depressed. so i'm probably being as conservative as possible so i don't get the comments on youtube saying i'm crazy. >> and you're wearing a nice outfit, nobody should criticize that. >> either way don't focus too much on the social media commentary. it can get in your mind. >> tom, great to see you. >> thanks. as we head to break, let's give you a road map for the rest of the hour. paramount shares are up about 9% as a takeover of the company or at least the saga nears an end. we'll have the details ahead. amazon hitting all-time highs. how much higher the stock can go from here and get top picks in the internet space for the second half. toneand private equity going in o hot area of the sports world. where they're investing their

money when we come back after this short break. i can't believe you corporate types are still at it. just stop calling each other rock stars. and using workday to put finance and h.r. on one platform. tim, you are a rock star. using responsible ai doesn't make you a rock star. it kinda does. you are not rock stars. (clears throat) okay. most of you are not rock stars. oooh. data driven insights, and large language models. oh, that's so rock roll. it is, right. he gets it. yeah.

welcome back. let's take a look at shares of para paramount. you can see backing off a bit up as much as 10%. you can see a deal is near once again. a key reversal from sherry redstone has made her not just amenable but essentially saying yes, to that deal i reported on for many, many months and was worked on since really the

beginning of january in a significant way that involves merging sky dance into paramount and red bird paying 15 bucks a share for 50% of the b shares and pay some 1.75 billion for the equity of national amusements, national amusements the holding company. they have a number of movie theatre circuits in there as well. but the voting stake in pair mound, it's the deal we've discussed for some time that i give the details on weeks ago but it unexpectedly fell apart at the last moment when sherry redstone decided she no longer wanted that deal, she changed her mind. why? my understanding, david ellison who runs sky dance is talking to her and her son tyler about the deal and perhaps it didn't hurt that they were willing -- or she was willing to accept and they were willing to offer another 100 million for the equity portion of nai and add 100

million because this had been a key point of contention to a fund essentially around indemnity to any legal litigation that would occur as a result of the transaction. you get 200 million added, essentially 200 million taken out and transferred to the b-shareholders. from what i'm hearing the deal could be done as soon as friday, certainly by the weekend and certainly before everyone heads out to the big media conference in sun valley. they want to get it done by then. so it doesn't appear that we are on the brink of a paramount deal to be signed. >> did barry diller trigger this to happen again. >> no, i think mr. diller has had interest for some time with trying to take control of a.i.,

not providing liquidity as this deal would, not merging an asset in as this deal would. but his interest, i don't believe had anything really to do with this. this deal was there and she made it a different choice this time. >> why is she making a different choice? it's not like the pricing is dramatically altering her outcome. >> i think the perception would be it's a good deal and given the incredible risk that paramount faces not to mention our own finances, frankly. there's a good deal of indebtedness at nai, plenty of risk around not just the business but around the balance sheet many would have said the first time around they didn't understand why she didn't take the deal. >> i do. >> so this story will be done. >> it'll be done. and we'll continue to follow the ravages of this business. >> right. of course, of course the driving factor behind this whole thing. >> exactly. >> david, thank you. still to come, the magnificent seven feeling,

apple, microsoft, amazon all trading around all-time highs. speaking of apple, the company reportedly set to take on an observer role on the board of open a.i. follow the announcement to integrate chatgpt into devices. we'll take a quick break here. don't go anywhere. [busy hospital background sounds] this healthcare network uses crowdstrike to defend against cyber attacks and protect patient information. but what if they didn't? [ominous background sounds] this is what it feels like when cyber criminals breach your network. don't risk the health of your business. crowdstrike. we stop breaches.

what is cirkul? cirkul is what you hope for when life tosses lemons your way. cirkul is your frosted treat with a sweet kick of confidence. cirkul is the effortless energy that gets you in the zone. cirkul, available at walmart and drinkcirkul.com. ah, these bills are crazy. she

has no idea she's sitting on a goldmine. well she doesn't know that if she owns a life insurance policy of $100,000 or more she can sell all or part of it to coventry for cash. even a term policy. even a term policy? even a term policy! find out if you're sitting on a goldmine. call coventry direct today at the number on your screen, or visit coventrydirect.com.

we're watching shares of amazon, you can see heading south after hitting a fresh record high in yesterday's session. news just hitting about 10 minutes ago, 15 minutes ago or so that jeff bezos has disclosed a plan to sell 25 million additional shares of amazon. the filing was made after close yesterday and it specified it could take place as soon as that day, it could be taking place right now. this is on top of selling 8.5 in february. so we are just talking selling is selling. it's well timed in terms of amazon's record. >> he's a regular seller. >> no, he'd gone quite a period

of time without selling before earlier in the year. he had gone i think a year or two he had not sold. remember he did change his domicile as well, moved to florida, which may have been helpful. >> the trigger for selling. >> may have been helpful as well in terms of the tax ramifications. obviously the stock's basically at an all-time high so his net worth is going up, even with the sales. >> why don't we get a take on this particular announcement from our next guest whose top picks include amazon. mark is able to join us, great to see you. what's your take on this selling from jeff bezos? is he timing it because the stock is rich? >> i don't know, people sell for a variety of different reasons. i like amazon as a stock. it's one of our top picks. i think there's more upside but i looked across the six largest cap names i cover, amazon,

google, meta, and uber, netflix and bookings, they're all at all-time highs so there's not much dislocation. there's very little. you can find pockets of it, there are opportunities on some of the names like netflix traded off, google did to. and uber did over robotaxi f fears. i like the sector, it's compounding now. not too many rerating opportunities. this isn't 2023, the beginning of 2023 or '22 where you had dislocating opportunities. i continue to like amazon even if jeff bezos is selling here. >> just dwell on this news for us a little bit more if you can, mark. because different ceos sell at different times. jamie dimon never sold and recently sold a little bit for estate planning reasons.

satya nadella has done two deals the last five years. bezos has been regular, but we are at all-time highs, and it's not like he did a certain amount every month. are there any when you see an insider selling that you take note or do you never care about it? >> i care about it. but it's not a huge indicator for me. i think if i downgraded amazon's shares every time i saw bezos or an insider selling i would have missed rallies. i don't find it interesting but frankly i don't find it actionable. >> you mention the big six you cover are at all-time highs. i looked at the list of your entire coverage university. they're all buys or holds. and more buys than holds. is that telling there's no sells? >> finding sells in the internet

space has been a hard thing to do but there are some companies i'd be cautious about. amongst those that i covered amongst those i currently cover i think outlook is limited in terms of the growth in online retail. it's kind of hard to like e bay. in travel it's three names, i have a buy on i think a value trade take on it. i hope i'm right on it. but sometimes you get it wrong. but i've been constructive on the internet space, a great performing sector for quite some time. particularly if you stick with the highest quality names. i think there's 10, 12, 14 names that are high quality that you want to buy consistently, especially on dips. >> we've been talking a lot this morning and yesterday about tesla and in particular robotaxi

day on 8/8. i'm wondering if in your models for uber and lift if there's anything regarding robotaxi we spoke to an analyst who marked down the value of the robotaxi and what it means to tesla because more value should be accorded to an uber and lyft in the world. i'm wondering if that's entering your model at this point or it's way too early? >> no, it is. it's impacted my stock picks. i made uber a top pick because of the robotaxi tellsell off. i may be wrong on this. i'm riding waymo later today, which is great, so is uber. it's all for consumers which is cheaper, which picks me up quicker. what was missed is uber is a demand aggregator. you can build the greatest fleet you want but you have to have the demand. there's uber with more demand

for ride sharing than anybody else. i think you have a hybrid network in the future. especially if you have multiple different robotaxi vendors, providers. i think that creates a great network opportunity for uber. so open up your uber app in five years, san francisco, new york, wherever you are, you see uber black, uber x, uber robo. some people will take that. i think it's a winner. i think the business will become stronger because of robotaxis. so when i -- you know when i see the robotaxi fares on uber i think it creates great buying opportunities. >> thanks so much. >> thank you. as we head to break, check out shares of nike. deutsch bank maintaining the buy rating on the name but slashing to 92 from 115 saying their estimates are hiacevable and could be proved to be

conservative if stocks move lower. that stock is down about a percent right now. stay with us. to duckduckgo on all your devie

duckduckgo comes with a built-n engine like google, but it's pi and doesn't spy on your searchs and duckduckgo lets you browse like chrome, but it blocks cooi and creepy ads that follow youa from google and other companie. and there's no catch. it's fre. we make money from ads, but they don't follow you aroud join the millions of people taking back their privacy

by downloading duckduckgo on all your devices today. welcome back i'm seema mody with your cnbc news update. jamaica is making preparations for a hit from hurricane beryl. the national hurricane center said the storm could miss landfall but the island will still face devastating winds and storm surge. so far seven people have died as a result of the storm. new mexico turning town a request from the film "rust" for economic incentives as they struggle to sell the film. tax authorities in the state denied the application in

spring. producers now face a late july deadline to appeal. and 70-year-old northeastern clothing chain bob store is shutting down all the locations. it's failed to secure banfinanc through a bankruptcy filing. back to you. thank you. keeps us on track because we turn to retail and commercial real estate. hp management is buying historic country club plaza in kansas city. it's a bid to bring back high end shoppers to what is a somewhat struggling retail environment. let's bring in re wash burn president of highland park village management. good to see you. our viewers family with the commentary from the past may be surprised to see you putting new capital out because you've been somewhat negative on the consumer for a period of time. so i'm curious as to why the

decision to go ahead with the deal? >> i still am negative on the consumer in the short term, david. but this property was built in the 1920s. a million square feet. it's indicative of the real estate market right now. bought at the peak for $680 million back in 2016 and no new capital was invested into it. you look at the market i'm going to have to spend well over $100 million, close to 200 million to bring it back to what it should be. and that's a three to five year process. so i think the consumer will come back in that time period. in addition to that we own luxury retail across the country they're doing okay. they had some slippage this year but not doing poorly. they're wanting to continue to grow and the only markets left to grow in are markets like our center in charlotte, north carolina and this one in kansas city. so we're optimistic about bringing that into the market but there's a lot of work to be done on the center.

>> obviously you're buying it at a deeply discounted price versus what it sold for in 2016 even with the additional capital. what gives you the confidence that luxury will continue to hold up? >> the consumer right now and there's a lot of aspirational buyers still in the market. there's a lot of debt on consumers, they're still buying things like handbags and shoes and belts and things like that. so they're still out there. and you can see by the sales of the luxury retailers, they're holding up fine. and so, we're betting on that as well as a lot of contemporary brands are doing well. we'll bring that in. those are brands like a rag and bone or alice and olivia that would like to come into the markets and really filled the gateway city markets and they need now to go to these markets. they're not going to malls. so the outdoor shopping experience is what they want. this is an iconic center. it's a million square feet fits

into the wheel house of what we do. when the opportunity came up a year ago, it took over a year to get the transaction done. it's indicative of where the market is. it's not a throw some quick lipstick on it, paint it, there's a lot of infrastructure that has to go into it. it's not like the office building market i don't know who wants to play in that market because i don't know where the tenants are. but there are tenants trying to come into a market like the this in a center like this. and the city of kansas city is partnering up with us, they're going to spend money on infrastructure as well to lift it back up to the glory it once was. it's the first shopping center in the united states and a well known property throughout the midwest. >> david had mentioned the deep discount you bought this for. seems like it was virtually a fire sale. i'm wondering from your standpoint how many other opportunities like this there are in the united states and how much needs to happen in order to sort of, you know, get past the

concern that there are more shopping centers out there. there are a lot of b properties out there, strip malls that need to be worked through. how much more pain is there? >> there's a lot more pain to come. i've said on your show for a long time i think there's more pain to come. the reason we went ahead and pulled the trigger on this deal, the deep discount. it took a year to get there with this. it wasn't like it was just thrown out there. are there others yes, i think the market sales is a long way to go. the reports that come out is here. we operate office buildings and we know how difficult the market is, and it's going to get worse. and the lenders right now if they don't come in and provide seller financing on it, there really is no financing out there in the marketplace of any kind of rate that makes sense. and so, i think it is a bad market. we started a project we're doing with msd, michael dell's firm in dallas. it's an $800 million office,

hotel, retail and residential property. we started six months ago in the dallas. and things are going extremely well. but it's a four star, five-star type of property. those are okay. anything on the other side you see the commercial banks but really the ones having problems are the private equity funds you see the redemptions are huge for those guys. they have no money to reinvest with the properties. >> yeah. let me end, ray, on the consumer again. we always use you as a voice on that. you have exposure in the restaurant industry, casual dining. what are you seeing in terms of customer accounts and how much money people are willing to spend? >> it's tough. in the astrrestaurant business held up. but customers, it's how muchn't they want to spend. that's down 10 to 15%. people want to go out, they want the experience but they're not willing to eat as much as they had, get the appetizer, the

extra drink. you see on the qr side of the fast food, and that's trading up to the casual dining side as well. we're concerned about it. fortunately labor has settled out, operating costs have s settled down. but the consumer is -- they're taxed. >> ray we'll leave it there for u ckoovi ook forward to hang yoba sn as well. >> okay, david thank you for having me on. >> you're welcome. bob iger headed into soccer ownership. we'll have the details of that next. we're back in a couple of minutes. trust. hang out. and check in. they all choose the advanced network solutions and round the clock partnership from comcast business. powering more businesses than anyone. powering possibilities.

switch to shopify so you can build it better, scale it faster and sell more. much more. take your business to the next stage when you switch to shopify.

the all new godaddy airo helps you get your business online in minutes with the power of ai... ...with a perfect name, a great logo, and a beautiful website. just start with a domain, a few clicks, and you're in business. make now the future at godaddy.com/airo

cnbc confirming that disney's ceo bob iger and his wife are close to buying the los angeles women's songer franchise, angels fcc. the reported valuation is $250 million, that would shatter the record for the most valuable women's sports franchise in the world. they would replace alexis ohanin

as the team's controlled shareholder. >> sticking with soccer as sports teams valuations skyrocketed, private equity has released massive priority stakes. less bee picker is looking at why the women's soccer league is allowing firms to take a controlling ownership position. >> women's soccer is having a moment and it's bringing private equity off the sidelines. while other major sports have been raking in pe capital for pass passive minority stakes the women's league is the first one to actually let them control the team. >> we see institutional capital as a way to really infuse additional capital behind our assets. >> the second deal closed a few

weeks ago, carlyle partnering to buy the reign, valued at 58 million, far beyond the 3.5 million it sold for five years ago. alex popov serves as alternate governor of the team. >> we're seeing that inflection point, seeing it for the right reasons and there's a lot of things for ul-al of us to do to continue. >> this year women's elite sports revenue is poised to cross the billion dollar mark for the first time. revenue is primarily driven by ticket sales, merchandising sales, partnerships and spons sponsorships. >> you can see from the jersey here they have a league sponsor in nike and in ally. and contrast that with men's sports revenue, which is driven by broadcast rights. but in november the nwsl signed a $240 million media deal over 4

years which is 40 times higher than the previous deal. it's clear why private equity wants to put capital to work here but the league is still in tryout mode. >> we're treading carefully because the capital is different. a lot of leagues are venues, wh will take a tremendous amount of capital as well. the year the first stadium purpose-built for a women's sport opened in kansas city. and it's something that the commissioner has said is essentially the future for the economic potential of this game. that stadium is for the nwls team, the current. so kind of an interesting look at the future and the potential financing opportunities for private equity, as well. >> i mean, it goes without saying. the valuation for these franchises has just gone through the roof. whether you were smart enough to have bought a wnba franchise or women's soccer, you have benefited enormously from the

increase in their asset prices, and their tv contract going up, what, 40 fold? >> 40 fold. so that is where people see the potential opportunity here. and that's why i think those iger/willow bay headlines are so interesting, because if there's anyone who would foresee the potential benefits of those broadcast rights, it would be bob iger. >> yeah. >> the ceo of disney. so the fact that he is looking to buy in at a $250 million valuation suggests that, you know, they see dollar signs in those broadcast rights, as well. >> amazing. keeps going up. leslie, thank you. leslie picker. we have some breaking news out of d.c. let's get to megan cosellah for that. megan? >> "the new york times" is reporting that president biden has told a key ally that he knows he may not be able to salvage his candidacy, unless he can convince the public in the coming days that he is up for the job. this is following that debate performance last week. the white house and biden's campaign have been really dug in this week, saying that he's still up for it. this is the first indication as

"the new york times" reports that the president is seriously considering that he might not be able to move forward. this ally emphasizes that he is still all in on his candidacy, as of now, but he's acknowledging that some of the appearances that he has coming up, he's hitting the campaign trail in wisconsin, he has an interview scheduled later this week with abc news. he's acknowledging that if those do not go well, that he might not be able to move forward. that's from the new "the ne times." >> over the last couple of days, there have been a number of democrats, some prominent, have come out and questioned whether he should continue, and a number of others, i think a couple of representatives, who said that he should bow out, correct? >> that's right. we're starting to see some cracks emerge in congress. congressman lloyd doggett of texas was the first one, the first elected democrat to come out and say that president biden should resign. the concerns in congress are really that weakness at the top of the ticket could hurt everybody down-ballot in both the house and the senate. and we're stooagger starting to

cracks emernl among democratic donors and fund-raisers, even among those who had stuck by president biden over the weekend, they were standing by him, saying they had seen him in person, they were reassured by him. just throughout the day yesterday, we saw some polling emerge that showed biden flagging, we saw betting markets start leaning towards vice president harris as the democratic candidate. all of that started to weigh on sentiment. now we're seeing some of those democratic donors and fund-raisers step out publicly as well and i, we might need a new candidate atop this ticket. >> this issue, though, megan, according to recent polling, harris, and governor gavin newsom, they don't do well against trump, either. even if they were evaluated to be the new candidate, that they would make any inroads. >> that's the key to watch here. and that's, i think, one of the big things that changed so much yesterday, there were some leaked polling that showed that vice president harris for the first time was on par or at least within the margin of error to where president biden was polling against former president trump. that's something that, you know,

the more that democratic donors, fund-raisers, voters, and elected officials start to consider a candidate harris, they recognize that she could adopt president biden's a apparatus, his campaign, much more easily than anybody else would. she would be able to choose a vice presidential candidate, she could choose someone with broad appeal in the party as well. there's starting to be -- we're seeing this coalescing behind her in a small way. it's people who are for the first time really starting to consider that she might be a possibility. and while she had been really cast aside, up until these past few days, now people are starting to really seriously consider shifting that. >> megan, just remind us what the process and timeline would be if president biden decided he no longer wished to seek re-election. obviously, the convention is coming up. when exactly, and what would need to take place between now and then? >> the convention is coming up on august 19th in chicago. that is the formal event at which biden would be nominated. the caveat here is that the

economic party, for weeks now, has been talking about moving that up, moving the virtual nomination up and doing it before the cop vengeance, for a number of reasons. the name one being to make sure he gets on the ballot in all 50 states. that means they're looking at potentially the end of july for a virtual nominating process. that gives democrats very little time, just about three or four weeks, to really get things in order if they wanted to stick to that sort of timeline. there's a lot of debate right now among elected officials and campaign strategists and others in the party, about what need to happen next. could they go through with some sort of primary? should they wait and do an open convention? the first thing that need to happen is that biden himself need to decide that he's going to step aside. nothing can happen unless he alone makes that decision. >> right. and then he potentially releases his delegates, but it does seem likely then that it would be kamala harris. you know, what about this idea that you would have some sort of process, as trun truncated as

might be, that you would have a free fall for the nomination? >> it seems like that's totally a possibility. the folks i'm talking to are a little bit split on this. they're emphatic on one point, the first thing they would like to see happen is that they would like to see president biden step aside. other than that, does it look really bad to skate over vice president harris, who is vice president for the reason to step up if the president cannot fulfill his duties. she's also the only one on that ticket and she's part of that campaign already. some folks think, you know, the party should coalesce behind her, because she's already in line. on the flip side, others say that an anointment of vice president harris as the new candidate without voter having really chosen her, you know, they were more choosing biden in the primary, that they think that would look back, it would be more chaotic if they proceeded that way. and didn't allow other candidate, other younger democrats to try to throw their hat in the ring. that's one reason why we have seen some splits so far, and

folks staying in the background, because they're not sure yet what's the least chaotic, best path forward. >> we should add that we're seeing reports from the white house claiming that "the times" has got this wrong, that the claim is false. that said, of course, it does seem to accord with a lot of the recent reporting, and we certainly will be standing by for your continued reporting. thank you, megan cosello. that'll do it for this hour of "squawk on the street." a lot more on the coverage of the broader markets coming up in the next hour.

(♪♪) (♪♪) what took you so long? i'm sorry, there was a long line at the thai place. you get the sauce i like? of course! you're the man! i wish. the future isn't scary. not investing in it is. nasdaq-100 innovators. one etf. before investing, carefully read and consider fund investment objectives, risks, charges, expenses and more in prospectus at invesco.com (office chatter) is it me...or is work not working? at least, not the way it could work. your people are buried in busy work. and you might be thinking... can ai make it all work? can ai help your people work... without all the workarounds? feel better. make customer service work the way customers expect? that one. make your old tech work with your new tech?

thank you. and todd here is wondering, can ai do all that... now? no pressure. it can. on the servicenow platform, ai transforms your entire business. your people work better, your customers are happier, and todd... well... he's practically euphoric. practically. because when your people work better, everything works better. so what are you waiting for? let's get to work. idris elba works here? mm-hmm. ya, he's super nice.

good wednesday morning! welcome to "money movers." i'm melissa lee along with wilfred frost here at post nine. the ceo of marathon asset management, bruce richards is here. we'll get his take on credit markets, friday's job reports, and the fed. >> and a tentative deal with paramount. jim stewart joins us here on set to discuss the skydance merger. >> later, uncertainty in europe, what to expectation from elections s abroad and how it affects your money