little bit on the nasdaq. it was not a huge shocker, obviously, the jobs report. >> bitcoin's a huge shocker, though. >> that is a shocker. it was at 54 for a while. looks flat on that chart, doesn't it? looks unchanged for the last six weeks. join us next week. happy friday. "squawk on the street" is next. ♪ good friday morning, welcome to "squawk on the street," i'm david taiffaber with leslie pic and mike santoli. we're live from post nine at the new york stock exchange. you just had a look at futures. joe called it riveting. tend to agree. that's really very exciting right there. but our show will be exciting, unlike, perhaps, what the market looks like. >> you know, that's riveting, even if it's not moving much. >> if it's getting mike santoli excited, then you know you got something going on. let's get to our road map. it does begin with continued job market resilience, not slowing

the tech stock rally. microsoft, amazon, and alphabet, all set to notch new highs at the open. plus tesla has bounced back, shares rallying again on track for an eight-day win streak. it's the longest since june of last year. and the labor landslide, the uk's opposition party winning a huge parliamentary majority in the country's general election unseating the conservatives after 14 years. let's get to that june employment report. nonfarm payrolls rose by 206,000. that was ahead of forecasts. the combination there of those two months, 111,000 fewer jobs than had been previously reported. the unemployment rate hit 4.1%, and according to rick santelli, when i was listening earlier, last time we saw that number or that high was november of '21. looking through the report as well, and obviously they analyzed it at length on "squawk box," 74% of the jobs,

government, education, and health care. and mike, listen, we have been paying attention to yields in the bond market this week in terms of potential tell. i'm curious to get your take on the employment report and the impact on the bond market and hence the stock market. >> yeah, the net takeaway is it's softer than not, under the surface, so downward revisions of more than a hundred thousand jobs. there had been this somewhat perceived disconnect between the parole payroll report and the household report. there's been a little bit of convergence there. private sector, job creation was below expectations. average hourly earnings softened up. in general, it still paints the picture of a cooling labor market. bond market, immediate reaction was yields rushed lower. now, not to anything alarming, but basically, two-year yield down where it was three months ago. so, you had this little bit of a scare that maybe there was going to be this higher for longer story. i was really does intensify the,

what should the fed do in the july meeting, perhaps, to set the stage for a september rate cut. i think you're starting to have that chorus sing a little bit more loudly in the sense that the preference is for the fed to be somewhat orderly and proactive and deliberate in how it decides to ease off of these restrictive levels of rates. it still says it's restrictive, and you'd want to go sooner than later so you're not rushing to rescue an economy that's really in trouble. i keep measuring things, market-wise and economy-wise, by the magic desired 1995 soft landingscenario. that's always been the idealized version of how you do it, because unemployment didn't go up during the tightening cycle back then. it really didn't go up this time during the tightening cycle. you had two quarters of stalling economic growth in '95. sub-2%, in fact, i think one initial report was below 1%. and so there was a growth scare. one cut, then another one several months later, it wasn't

a big easing cycle. it was just taking the pressure off, and equities were at all-time highs as they were right now, so this general sense of, you know, you can kind of loosen things up while you have the luxury of an economy that's still functioning pretty well at near full employment. >> another concern that people are pointing to was temporary help declining 49,000 in june. and the swaps market, to your point, now predicting 72% probability for rate cut in september. which, of course, we've seen this movie before with the, you know, the swaps market being wrong in terms of when to expect rate cuts, but notable that you believe that there was potentially enough kind of friction in this report to suggest that september is still a likelihood. >> incrementally, yeah. and i guess the case is building, is the way i would put it. next week, you have the cpi report. that's probably got to get thrown into that mix as well. we've been surprised at the stickiness of inflation along the way. but really, it is the cumulative evidence, we've seen the

downside surprises in general economic data for weeks now. ism services the other day as well. all of that fits together into a similar story of, hey, we thought the economy would and should decelerate to some degree. how much it will remains to be seen. it's kind of showing that to be happening right now. now, what's interesting, too, is that private sector profit growth is still expected to be really good and, in fact, start to pick up in a lot of areas of the economy, so there's been this kind of, you know, asynchronous way that the profit cycle and the, let's say, labor market cycle have been operating for a while. >> you mentioned '95, right? that does bring you to tech stocks as well. it's interesting, sort of put that in perspective of an incredible rally that i can well remember. >> yeah, i would say '95, we were just -- we didn't have much of an inkling of the kind of multi-year, multi-decade tech renaissance that you might have. >> but it was fueled by, obviously, a so-called revolution.

then, it was the internet. now, it's a.i., which does get us to these stocks you're looking at right there. microsoft, all-time high. it's up 10% in the last month. you can see it. apple has found its footing after what was sort of a difficult year for the stock to a certain extent. but take a look at that gain over the last three months. alphabet as well. it goes on from there. tesla, also, we talked about earlier this week, mike, with significant gains. i think it's seven straight sessions. >> yeah. >> i don't know. it's just the same story. >> yeah. >> didn't even mention nvidia here, though. >> that's right. well, nvidia's the one that obviously, you know, massive overshoot to the upside. i mean, overshoot relative to everything else in the market, basically. and it's trading, you know, double digits below its high, so that's the one that's kind of consolidating after this massive move. the rest of them, it is this impression of a market that keeps sort of discounting the same well known news every day when it comes to these stocks which is all the things we know about how they're in the right

place, right time, they can invest for any scenario, and as i like to say, they live in a world without painful tradeoffs. it's not like, well, if we do this capex, we can't do the buybacks and we can't do -- we have to lay people off. no. they can kind of afford it all at this stage, and at the moment, the market's rewarding them for that, that long-term perspective. now, i think the bull case really for the market is that other companies outside of that cohort start to actually show better earnings growth, start to kind of justify maybe a little bit more help on the valuation, but it hasn't really come to pass, basically. >> i thought of you this morning, though, because i know in the past, we've talked about the correlation between bitcoin and at least nifvidia, and it seems like that has decoupled this week with bitcoin set to reach its lowest level since february, worst week in over a year in terms of performance. >> it's definitely decoupled with regard to the overall market or the nasdaq. it's down like 25% off the highs. it certainly exceeds anything we've seen in any of those big

stocks. that said, you know, nvidia peaked right around when bitcoin peaked. it's not so much that they go step for step, but it is a similar cadence, and of course, there are some unique factors with bitcoin. people expect this supply of these seized bitcoin to hit the market, but to me, that's more excuse than cause, usually, because it just shows you this market needed to back off a bit. >> let's get further reaction from the biden administration to the latest jobs report. joining us from washington, d.c., is acting labor secretary julie su. nice to have you. a strong report as we've been saying, although perhaps some signs of at least a weakening economy. i'm curious to get your take, particularly given a great deal of the jobs were added in both government, education, and health care. travel and leisure, for example, seem to abate a bit in terms of its addition of workers. >> yeah, we saw growth in construction as well. again, these are signs of a

strong economy and a historic economic recovery. the 206,000 jobs created brings the total now since president biden came into office to nearly 16 million. none of this was promised. none of this was inevitable. they are the result of leadership and economic policies that include a plan to invest in america and america's workers, and again, we are seeing the impact of that month after month, and the unemployment rate remains at really historic lows. we did see a slight uptick in prime age workforce participation. that often can be associated with slightly higher unemployment rates also. that's people in the labor market looking for jobs. we're seeing that it's taking a little bit longer for people to get those jobs, but that's why the work that we are doing to ensure that there is a clear pathway for everybody to get a good job in their community remains so important. >> yeah. you mentioned, of course, that we're now 4.1% in terms of the unemployment rate. the highest we have been since

november of 2021, so that is a bit of time ago. you mentioned the participation rate going up, so is it a concern for you at all? i mean, obviously, most economies, we would be happy with 4.1%, but it is up from where we had been in terms of historic lows, recently. >> exactly to your point about most economies. we had an unemployment rate at or below 4% for the longest stretch since neil armstrong stepped on to the moon. and now, it's ticked up slightly to 4.1%, and as you said, this is still a really historically low number. by comparison, let's just remember, on this day in 2020, during the last administration, the unemployment rate was nearly 12%, and so we've come roaring back from that time period, and most people, you know, celebrated july 4th. i'm here in d.c., seeing people get together with their families, come outside. in 2020, people were told to stay home and stay away from everybody, so this is the kind

of economic recovery that is only possible when there is wisdom, experience, leadership, and real investments, which is what we've done and what we'll continue to do. >> that said, economists have been pointing to the fact that today's report technically triggers the rule that says the economy is entering a recession if the three-month moving average of the unemployment rate rises 50 basis points above the trough. do you see any evidence that a recession may be around the corner? >> i don't. and we have been, you know, like hearing about potential recession pretty much since 2021, and that has never come to pass. i would say that based on the numbers, we've seen not just this last month, but that i come here every month to talk about, if this isn't a soft landing, i don't know what is. >> i guess the counter to that might be that it almost always looks like a soft landing until it becomes something a little

bit worse than that. what would you hope to do to try and ensure that it doesn't happen? honestly, in terms of even practical, you know, sort of policies, it feels as if the policies from the administration are kind of in place, and not necessarily in train. >> that is the right question. so, let's look ahead. what the president has always said and always known and helped make possible is historic investments in our country's infrastructure, in fixing hundreds of thousands of miles of roads, of bridges, of ensuring that every family has clean drinking water when they turn on the faucet, of putting high-speed internet into every single community. those are the kinds of investments that we are delivering on every single day, but the reversal of decades-long disinvestment in american industry, in american jobs, in american workers, it doesn't happen overnight. the fact that we have had these numbers now for as long as we have had is a sign that the

president's economic strategy is the right one. we are on the right track. but we do have more work to do, and the good thing is, we have a plan. we have investments in place, and we're going to keep at it. >> president biden is trailing significantly in the polls to his rival, former president trump. now, there could be any number of reasons for that. but certainly, perhaps his failure to successfully articulate what you are saying, which is that there has been historic addition of jobs, could be contributing to that. is it a frustration for you and the administration that perhaps you're not getting the credit at least you believe you deserve? >> i mean, the president talks about this all the time. he has said from day one the way to build a strong economy is to invest in measuamerica's worker create american jobs. these jobs numbers reveal time and time again just how solid that economic strategy is. you know, if your question is what i'm concerned about, i have the same concerns that the president has. whether workers are getting a fair share, how to combat the

massive gap between ceo pay and frontline worker pay where ceos make, in a week, what their workers have to work years to make. making sure that we are cutting the cost of prescription drugs, making sure that student loan debt is forgiven so people can look toward their future with hope, ensuring retirement security so american workers can retire with security, saving pension funds, giving workers a raise. just this past week, over a million workers became eligible for overtime because of this president's policies. i don't think it could be clearer what we stand for and what we're trying to do, and we know that the work is not done, and that's why we're so focused on doing the work. >> all right. thank you for your time, acting secretary su. appreciate it. >> thank you. coming up, the labor party's landslide victory in yesterday's uk elections, a look at what to expect after 14 years of conservatives being in power. let's give you another look at futures. getting more and more exciting

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welcome back. a changing of the guard across the atlantic. the labour party winning yesterday's uk elections in a landslide, marking an end to 14 years of conservative rule. wilfred frost is here with the latest. 14 years o. >> on to a new start. the uk has a new prime minister and a very powerful prime minister at that. won 412 of the 650 seats available, and they'll now be able to govern pretty much as he sees fit. his majority of 175 on par with that of tony blair when labour last took power in 1997. the defeat for the conservatives, losing 244 seats and winning just 121 seats, on just 24% of the vote was historically bad.

starmer won his 63% of the seats on just 34% of the vote. that is a record discrepancy. why? well, in part because nigel farage's reform party took 14% of the vote, thus sunak oversaw a split of the vote on the right compared to the way in which boris johnson united the right four and a half years ago. turnout, too, was lower than normal. it was in the low 60s. here is starmer in downing street, giving his first speech as prime minister. >> whether you voted labour or not, in fact, especially if you did not, i say to you, directly, my government will serve you. politics can be a force for good. we will show that. we've changed the labour party, returned it to service, and that is how we will govern.

country first, party second. >> so, starmer is the most powerful prime minister domestically for a generation, but also, somewhat out of nowhere in the eyes of the rest of the world. he heads to the nato summit next week as one of the most powerful leaders there in stark contrast to president macron of france and reasonable contrast to olaf scholz of germany. >> you guys do not give your outgoing prime minister a lot of time to pack up. >> no. >> wow. >> no time to pack up. by the way, the positive thing, both sunak in his good-bye speech and starmer in his arrival speech, they both commended each other. very smooth and conciliatory handoff of power. no delay until inauguration day. >> nothing like that. more importantly -- >> you also get the indignity of the prime minister goes to buckingham palace as prime minister in a government car, and he has to leave out the back in his own vehicle. >> no kidding. >> as just an mp. it's quite brutal.

>> it's certainly reality hitting you. what can we expect, though, from this labour government in terms of, you know, important initiatives that will be undertaken? >> so, already, the house building stocks are up sharply today because that is something the country has desperately needed, more homes, but under the tories, never got round to it because it would disappoint their base if you changed planning laws. it's expected that will be one of the first things they do, even as early as july in the parliament before i was t goes break for august. eu negotiation in 2025. it comes early in his term and gives him a lot of cover to do more than has been talked about on the campaign trail. certainly won't rejoin the eu, but perhaps tighten the trade ties, which have been broken. that could be good for business. on the overall fiscal plan, there's not much money to spend, and he wanted to play things safe because he thought it would lead to a big victory, and there hasn't been promises on more tax, more spend.

they're both seen, sunak and starmer, as ultimately centrist and pro business. comaling up, what to expect from the energy sector. we got a lot more "squawk on the street" for you rahthe.stig aad [crowd chanting] they ignored your potential, and mocked your ambition. but it's not the critic who counts. with every swing and block, your game plan never changed. ♪♪ some still call it luck. let them. because you know what it's always been. inevitable. ♪♪ ♪♪

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take a look at the gainers as we head into a full session today, by the way. of course, on wednesday, we had a abbreviated session. full session of trading today, five minutes from now, and tesla, quite a week it's having. that stock, at least, erasing virtually all the losses that the stock has seen for the year. we're back right after this. and don't forget, by the way, you can watch us any time and anywhere by listening to and following the "squawk on the street: opening bell" podcast. to duckduckgo on all your devie

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>> announcer: the opening bell is brought to you by nuveen, a leader in income, alternatives, and responsible investing. boeing is facing a key deadline. the company must decide by the close of business today whether to plead guilty to a felony fraud charge that's in relation to those fatal crashes of 737 max planes in 2018 and 2019. if it doesn't, it could face a criminal trial.

the justice department has until sunday to determine whether to prosecute boeing for violating terms of a january 2021 agreement which would have shielded the jet maker in connection with those crashes. mike, i don't know how to gauge this in terms of impact on the stock. >> i wonder if the -- if the key question is, how, if at all, it affects the ceo search. you know? i mean, you could probably game that out either way. i mean, you would want to know what he or she were walking into in terms of that side of things, but no, i really don't -- i think it's down to these levels where it's like, oh, we're trading off the long-term duopoly value here. we don't really know what the impact is. the spirit aerosystems thing, fine, that's a loose end that was tied up, but in general, it feels like kind of this limbo situation, and the market's treating it as that. >> the ceo search being led by steve mollenkopf, who used to run qualcomm and is obviously

leading that search as a board member of boeing. >> yeah. the balance sheet's -- we've got this deal in the works with spirit aerosystems, which is over $4 billion. >> first at the big board, merchant marine. at the nasdaq, industrial manufacturing company tungray technologies. that's a recent ipo. merchant marine academy based in kings point, not far from the border with new york city. >> that's right. right on the border. >> and on the water, as you might expect. >> exactly. >> makes sense. >> it does. yeah, you know, i think the key thing in the outset is how the bond markets script has been scrambled a bit in the last few days. remember, we were just a couple days away, a week ago, really,

when we were dealing with, uh-oh, we have another melt-up in yield, people focused on the fiscal situation, maybe handicapping the presidential outcome, and now this run of softer economic numbers has, you know, created this undertow in treasury yields once again. so, down to 4.30% on the u.s. treasury, which is this kind of median area of this neutral zone we've been fine with for a while. the two-year yield collapsing a little bit, and it really does create a little more sharpness to the debate about what the fed ought to do, and what's interesting is, do we see the parts of the stock market that theoretically should rally on increased fed rate cut odds do so? and it's been a mixed picture. small cap stocks, for example, have not really taken the bait on a consistency basis because of all the other things overhanging it. nobody's quite sure if that playbook really applies in the current cycle. >> well, it feels like riskiness

is gradually being inserted back into the rate complex, given just the uncertainties involving the u.s. election, the potential for increased deficit spending, what that means for the prospect of those cuts. you know, obviously, since thursday, that's been a key part of the conversation, and what it means for people hoping to get some semblance of gains in their bond portfolio now that's more called into question over the last week or so. >> for sure. you know, and again, it's -- we're still just kind of, like, meandering around this range for the most part. and i think it's been okay, but it feels as if there's a little more urgency to this question of, maybe, the fed's been dealing as if it had the luxury of patience and there wasn't a lot of risk to -- in action for a while, waiting for the data to come through. and again, next week's employment -- inflation numbers are going to matter a fair bit for swaying that one way or the other. >> and it's the usual suspects that are up. apple, meta, alphabet, amazon, microsoft, actually, up, well,

one cent. and then, tesla continuing what has been a very strong week for the auto maker. although, elon musk would not like to hear it called that. prefer to call it an a.i. company with a robotics arm that happens to also make some evs, i think, is what he would prefer. but the delivery numbers, encouraging investors as well that we got earlier in the week, and the stock is now, let's call it, flat for the year, approaching an $800 billion market value yet again. >> yes. >> what it hasn't seen in some time. >> you know, to the point of whether it's, you know, in the here and now, a car company, the delivery data probably had the effect of taking a little bit of risk out of the earnings report, which is coming up later this month. and the idea that you could start to make the case that things are bottoming, demand is responding to, you know, more financing incentives and things like that, and in general, you know, we've maybe seen the worst of the declines in terms of volume growth expectations. that being said, it just was a

laggard in the mega cap tech-related beta trade, and those laggards are getting bought, and there has to be some place for the wild sky's the limit energy that was fueling nvidia to go, and one place it goes is tesla. there's also lots of overlap. i don't know how we can handicap this. there's a lot of overlap between people who would be excited for a second president trump administration and people who generally are excited about anything elon musk touches. so, i'm not saying that's the whole story or even most of it, but it's all traveling in a similar direction, i would argue, and then you have this august 8th robo taxi event, and tesla stock does best when there is something dangling out there that says, hey, this is what they're going to tell you how they're creating the future, whether it happens or not, whether the timeline is plausible or not doesn't matter until you get there. >> august 8th, of course, is when we hear about the robotaxi or at least get the latest and perhaps a lot more details in

terms of full self-driving. >> yes. >> but before then, guys, i don't know furlif you realize this -- >> i know what you're going to say. >> bank earnings season a week from today. we've already started get a slew of preview notes giving us a sense of what to expect. we got one from mike mayo of wells fargo on wednesday, shor shortened trading day, but that is not stopping the research from coming out. he increased second quarter estimates on capital markets-oriented players. i know that will pique your interest, david, jpmorgan, goldman-sachs, morgan stanley, and lowered on several regionals, including keycorp, comerica, and truist. those downward revisions on the regionals reflected weaker net interest commentary. i believe we saw that out of the financial conference a few weeks ago. there's been this overarching question about when you'll see that inflection point, when you'll see that trough in net interest income, and a reminder

to our viewers, that's the profitability metric from loan making and whether or not higher for longer interest rates will impact when that trough happens, whether it will have to be pushed out further beyond the 2q, which is what a lot of people were expecting. mike mayo focused on that. and then, of course, you have this story in "the wall street journal" today, which is, an interview with mary ann lake, who runs, basically, chase and consumer banking for the bank, talking about how regulations are impacting their need and the potential for their need to pass down some of those fee restrictions on to customers. so, the story goes into this idea that the cfpb's proposing of an $8 cap on credit card fees, plus these bank capital rules we've talked about many times on this program would require additional fees elsewhere for consumers, and

mary ann lake is quoted in saying the people who will be most impacted are the ones who can least afford to be, and access to credit will be harder to get. in other words, those fees may be capped in certain places, but you will see additional costs poup up for the consumer elsewhere. >> yeah. looking at that chart, especially the even shorter term one, there it is. the last earnings report, this stock got crushed. now it's made it all the way back, as you can see. >> oh yeah. >> and it's right around the same performance as so many of the other big cap banks, bank of america, citi, goldman, and wells fargo all sort of up around 21 to 25%. but that was an ugly report. you might want to just refresh our take on it, because going into next week, it might be worth remembering. >> yeah, no, a lot of it had to do with that, nii inflection point that we were talking about and the guidance they gave that disappointed the street in terms of what it was expecting for the rest of 2024.

however, since that time, there's been significant capital return from jpmorgan. they had kind of an off cycle dividend hike. they just hiked the dividend again, i believe. they have increased that dividend about 19% this year. that's well and above any other bank in terms of the percentage gains in that dividend. although we did see some significant dividend hikes following the stress tests, which were largely seen as tougher than expected. that said, the banks are kind of evidenting their capital positions relative to a potential watering down of the basel iii capital rules, so they're striking that balance in terms of what to return to shareholders, but clearly, jpmorgan is in a position where they have an exorbitant amount of excess capital so they have decided to return a lot of that in dividends. >> and charge for checking. >> and charge for checking. >> forget the excess capital being used to cover a checking account fee. >> the thought used to be that the way you paid for checking is

not getting interest on your balance. >> right. >> no, you get interest, 0.01. >> right. >> i think the point that mary ann lake made in "the journal" article or at least "the journal" reporter did was that the basal iii rules would require you to reserve more against the credit card balances that you have, so you have to rein in the amount that you are able to lend as a result of these policies. >> going into the last earnings report for jpmorgan, the level of outperformance for that stock versus every other bank was monstrous. so, every sector has the one big anointed defensive bulletproof name and that was jp. it's not quite the same this time around because the other banks, david said, have participated. >> other than one, leslie, which is morgan stanley, under new leadership. it's still up but lagging noticeably. why? >> a lot of it has to do with some disappointing -- disappointment surrounding net new assets.

obviously, wealth management has now comprised about 50% of morgan stanley's revenue base, so you've got 50%, which is tilted toward the capital markets, which have been not -- not the best, although it sound like mayo thinks they could improve, and then the other 50% is the excitement surrounding wealth management, which has historically done really well. it's become this behemoth, obviously, under james gorman's tenure. that was kind of the hallmark of his duration at the top of this firm. there's some concern among the investor community that that's stagnating some, and that has kind of created a bit of a -- an overhang on this stock so far this year. >> yeah. on m&a, you know, i would only say that we're going to -- i'll be paying close attention perhaps as soon as later tonight, this weekend, whether we get that final deal for paramount that we have outlined so many different times. that seems to be the expectation going into this weekend.

i had sort of said that already on wednesday. i'll be very interested to see the overall capital contribution, what that looks like, because you are talking about $7.75 billion or so in new equity. remember, $4.5 billion to buy the bs and some of the as, billion and a half contribution to the balance sheet, and then the money as well going to pay shari redstone some $1.75 billion. that takes me to oracle's stock price, because larry ellison's likely to be a lot of that money. >> sure. >> and don't forget, as oracle now hits $400 billion in market value, he owns 41.69%. at least that's the latest numbers i see, mike. >> yeah. >> and so, it will be interesting when we sort of all is said and done and that transaction does get put into contract, larry ellison may end up being by far not just the control shareholder, so to speak, because of his ownership,

but very significant capital contributor to the deal. >> you wonder what it means for the economics of the business. if he chose to, he could fund a lot of losses. he could actually backstop that company to a fair degree to a level that, you know, wbd doesn't really seem like it could keep up with. >> that is true. >> who knows if that's part of the plan. >> $14 billion in debt. we need to remind people. a tiny little market cap of some $7.7 billion. people try to weigh, listen, when this thing closes, half your equity, you're going to be able to get a nice premium. >> and you bring up the capital markets, and we've seen some interesting deals this morning with regard to the saks and neiman, the amazon infusion there. there's reports that the macy's bid is getting raised as well, so there's some fervor surrounding these department store names, which is an interesting, you know, note for this holiday week. >> yeah. apollo, i think, their credit fund providing some financing as well to that transaction you're

looking at right there. and then as you point out, brigade and arkhouse, in terms of macy's, that's reports from "the journal" saying they've raised -- it's unclear how much traction they're really getting there. i haven't been able to get a sense. >> or if it's price sensitive or something else. >> macy's -- if nothing else, maybe just says that, you know, private money says that there's rock bottom value in department stores. macy's trades like 20% of sales, and you never saw that outside of the global financial crisis before this last cycle. so, who knows if that's what that means? that being said, it's a little bit spotty in terms of deal activity. it's not like there's a lot of massive deals. >> there's not a lot. >> ipos are almost done for the summer. >> m&a is better than last year, but that's not saying anything. last year was a horrible year in terms of activity. we're not seeing -- keeping an eye on hub spot. i got nothing new to add. we'll see if we get there in terms of where that leads, but not a lot of big deals, and most recent conversations indicate, perhaps, there's a waiting game going on now in terms of the

election as it looms. >> absolutely. you kind of get to this point where, you know, it takes how long to get a sticky regulatory deal done? at least a year. >> usually. oh, yeah, at least. >> year and a half. >> year to 18 months, at least under this administration. >> so, if there is some sort of change in control that would warrant a more friendly antitrust environment, you have to believe that those discussions have maybe ticked up over the last week or so. let's take a deeper look into the is energy sector as we kick off the second half of the year. year to date, it's been underperforming. the s&p 500, but the growing demand for power to fuel a.i. datacenters has put the spotlight on this group. joining us now with his outlook is rob thumbal, tortoise senior portfolio manager. rob, let's start there, this a.i. tailwind, maybe unexpected to those of us who don't follow n energy closely. do you see it continuing, or do you think that most of the gains surrounding this excitement have already been priced in?

>> good morning, residencely. th leslie. we think there's an opportunity for a.i. basically in the energy sector. everybody talks about the technology infrastructure. what everyone forgets about is the energy infrastructure and a lot of people are starting to talk about it. you need more power. you need more electricity. and so you need more natural gas to fuel that electricity. so, what i like to say at tortoise is there's no a.i. without ei or energy infrastructure because you need this critical infrastructure to keep the electricity flowing 24 hours a day, 7 days a week to datacenters around the world and around the u.s. >> the best performing energy stocks are infrastructure names. as well as some refiners. do you think that the tailwinds boosting these names are also ones that can continue the rest of the year? >> a.i. is part of the equation, but i think the other part of the equation is that these

stocks are pretty simple stories. they are generating a lot of earnings, converting those earnings into cash flow, and they're really returning that cash flow back to the investors in terms of high dividend yields, as well as stock buybacks. that's a simple equation. a lot of these energy infrastructure stocks have big economic modes. warren buffett likes to talk about these asset footprints are very difficult if not impossible to replicate, so investors are starting to recognize that and frankly reward that, and all investors like to receive a lot of current income and grow. >> rob, that certainly all the case in terms of how these companies are navigating the industry. i guess one of the areas of pushback is that when it comes to oil and gas, every cyclical peak in absolute demand is seemingly going to be lower than the prior one. and you're seeing that with gasoline usage and miles driven and all the rest of it. so, how do you, i guess, filter that into your outlook for the kinds of energy companies that are well positioned? >> you know, what scott talked

about a lot, global energy demand is at the highest it's ever been. next year is a higher record. we continue to see global energy demand continuing to rise. if we look back, global energy demand's risen 38 out of the last 40 years. really, what's interesting, u.s. has become the largest producer of oil, the largest producer of natural gas, and the largest exporter of energy in the world, and so, the u.s. energy sector has made a significant contribution, i guess, not only domestically but globally, both economically and socially, we just don't see that changing any time in the next several decades, so that is really the opportunity for the broader energy sector, including energy infrastructure. >> so, then, how are you constructing your portfolio right now? and are you doing any allocation shifts as we look ahead to 2 h? >> yeah, so, little bit of allocation shifts. i mean, it's still -- the big picture is still energy

infrastructure, but recently, one of our top names is sheer energy. that's a company we've talked about or liked before. the company just announced a new capital allocation policy, and since they've announced the capital allocation policy in 2021, they've increased the dividend 50%. they've lowered their debt 20% and bought back 10% of their stock. their new allocation policy allows them to buy back another 10% of their stock. capital allocation policies are companies that have high free cash flow with these type of capital allocation policies are the companies we're looking to buy and continue to add to our portfolio. >> rob, appreciate it. rob thummel with a look at energy in the second half of the year. before we head to break, let's give you another look at the bond market. it's time for the bond report. mike talking about 4.3% on the ten-year, so we've been hanging out there, although we've had an interesting week. you see right there, we're at 4.31%, and the two-year also down to 4.639%.

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as we move further into the summer season, what can we expect from the travel sector in the second half of the year? seema moody is back at hq with a look ahead. hey. >> listen the demand story still remains strong. we had the latest data from mastercard which shows travelers intentions to go oversees remains high helped by lower airfare. the inflation report did show airfare prices dropped 6% year over year and then the major

events this summer driving interest to europe from taylor swift eras tour, euro cup to the paris olympics fueling deal activity as well. hyatt just announced it's acquiring an urban lifestyle brand in germany which is a feeder to other vacation hot spots like greece and the islands. right now hyatt generates 5% of earnings from europe, while marriott is at 15%, hilton at 10%, according to true u.s. estimates. hilton did acquire majority controlling interest in fidell group to expand a brand know mad hotels and private equity has shown history, blackstone acquired village host that's a group of 33 properties in the uk that appeal to business travelers. noble investments who has invested about $2 billion in hotels and hospitality in the last 18 months says valuations are driving the broader activity in the space with public hotel reits trading at 10 times ebitda, a 25% dict to private

market values. he adds hotels are seeing sizable returns with interest rates remaining high and growing supply one of the key ways the hotel operators can compete with airbnb. you will see airbnb is outperforming the major hotels up about 12% this year. marriott up 6%. david? >> seema, thank you. seema moody back at our headquarters. mike, thank you as well for joining for the hour. a lot more coming up on this week's tech rally. nasdaq new a-tllime highs. keep it right here.

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good friday morning. welcome to another hour of "squawk on the street." i'm david faber with leslie picker and wilford frost. we're live. carl and sara have the morning off. let's give you lack at markets a half hour into trading. we're up on the s&p and nasdaq. that's new territory when it comes to the nasdaq certainly,

leslie. >> we are 30 minutes into the trading session. here are three big movers we're watching this hour starting with tesla aiming for its eight straight day of games up the last full month of trading trying to close in positive territory year to date. currently shares up are about a percent. bitcoin sharply lower down more than 20% over the last month hitting its lowest level since february. we'll do a dive on the crypto later this hour, but currently down about 4.3%. and macy's shares are rallying following a report that archouse and brigade have raised their takeout offer for the retailer to 24.80 per share. more jobs than expected but the employment rate itticing hig higher steve liesman is here to break it down. >> it was a strong june jobs report thats came with signs of weakness under the hood. here are the numbers.

we're at 206, around what was forecast, but the april and may numbers were revised down by 111,000. a continuous set of downward revisions. unemployment 4.1%. first time above 4% since november of 2021. average hourly wages behaved at 0.3, the year over year to 3.9% from 4.1% back where it was in the prior month. here's where the jobs were interestingly and we'll talk about this in a second. local government jobs, local and government, federal and government, by the way, not just local, that's 70,000. health care 49,000. goods producing 19,000. leisure and hospitality, a source of a lot of jobs, up 7,000. temporary help declining is a sign of maybe further weakness to come because that can be a sign of where the job market is heading. then you have this slowing private sector job growth getting a lot of attention this morning. down at 136,000. it's been weak two of the past

three months. august more weakness ahead if government spending drops off so you don't have all those government jobs being added. what did the fed funds market do? they continue to put a low probability on july cut but feel somewhat more confident of a cut in september. you have futures trading now, you can't see it right there but with a 72% probability of a second cut in december. this month's data not definitive. the job marketing weakening and you're doing wa200,000. because of immigration and higher participation may be the steady state of job growth. but this number and the stuff underneath it bolster the members of the fed committee who have said in recent weeks might be time to keep a closer eye on the mandate not just the inflation side. >> the probabilities of cuts have moved around a bit, but if you look at the 2 year note it's moved significantly. do you think it's moved bait too much in light of those

probability changes. >> i never say what people should be doing on a friday afternoon. >> right. >> or friday morning when i think a lot of young guys are doing the trading, young men and women doing the trading. i'm not sure. but look, if you're thinking about the fed reducing rates down the road, we've taken another step trade the 2-year lower. that's what you would do in yield. i don't know it's bounced around a lot. we had roger ferguson on this morning on "squawk box" whose opinion of course you have to respect, and he thinks the market is over its skis on that 75% probability of the september cut. and a lot is going to depend, we get another pce, another inflation report coming, i guess that's next week, cpi, and then before the fed meets. if this unemployment number keeps going up, and we keep getting this weakness in the jobs report, like i said, it's given the committee members something to think about and bolstering the position of those who are saying look, there's two mandates we've been focused for months only on the inflation

side. it's time we start thinking about the employment side as well. >> steve, average hourly earnings up 3.9%. you want to put that in perspective afternoon hours and give us your take. >> it means we've had another positive month of real wage growth and it's finteresting because the higher prices is a major political issue so we're coming up on 12 or 13 months where theyear over year real earnings have been positive. that's good news. people at least are keeping pace and maybe making progress against inflation and it's coming down to a place where i think the fed would increasingly say it's consistent with the target 2% growth. i think -- 2% inflation target. i think it's still a little bit high for their tastes, but it is coming down. >> steve, great stuff. thanks so much for that. steve liesman there. s&p and nasdaq both sitting at or near record highs on the back

of that jobs report. we've just paired some of the gains actually for u.s. indices kind of flat is speak. and let's bring in jpmorgan strategist david kelly. great to have you with us. what's your take on that move we've seen in the two-year? do you think it's a bit ahead of the skis in terms of how many cuts we might get? >> not really. i mean i do accept the point that on a friday after the fourth of july don't necessarily trust what's going on in terms of trading. but overall, we think that things are setting up for two cuts this year. one in september, one in december. what we're seeing is the economy is cooling, but it's cooling slowly. that's very much the theme in this jobs report. i sort of echo what steve was saying about it. i think it's significant they downgraded payroll and job growth by 111,000 by the prior two months and drop in temporary workers. these are signs the economy is decelerating here. and we're also seeing signs, you know, despite a tight labor market, it's still tight with an

unemployment rate of 4.5%, we're not seeing wage growth come out of that. so next big headline will be next week's cpi report. we think we're going to be down to 3.2% year over year number, and that should push the personal consumption down 2.6 to 2.5 year over year so we're edging ever closer to the fed's 2% target. that's enough progress with the fed to begin to cut in september. >> how much does where those yields are sitting influence whether you should be increasing or decreasing your exposure to u.s. equities? >> well, i think this is a time we've got to be pretty careful here because valuations are high. we've had a huge rally last year and the this year and, obviously, mega cap valuations are distorting everything. overall, these markets are high. and sooner or later we're going to have a significant correction and what i know about the previous corrections is when in a correction you don't want to be in the most expensive stuff, so i think people do need to be careful here.

not because of anything going on in the economy. the economy in its own ways the economy is building sort of bubbles and markets because it is so steady, but we have seen this continued move upwards in equity prices. i think it's time where people need to be careful about diversifying their exposure and not being overexposed to the most expensive names. >> you've spoken in the past about the risk of concentration in the current environment. do you expect there's a group think the broadening out will be receptive from the broader market as well? do you expect to see more breadth in the market in the months to come? >> yeah. well usually the arket, market gains breadth and loses height, and i am concerned that yes, the market could get a good deal more breadth, but i think the concentration will diminish and increasing risk the concentration will diminish because the market takes a tumble and the tough at the top the biggest tumble. people need to be long-term investors. i am a long-term investor.

i don't think it's a time to pile into cash but time to think about the valuations of the stuff that you hold in your portfolio. yes, the market is concentrated, how concentrate ready you? by leaving everything set so to speak over the last year or two are you in a position you have more risk than you should have in your portfolio. >> yeah. although people would say, i mean you can't help but be concentrated in the sense even if you own the s&p you're 30% plussent is six or seven stocks. that said, those who who are favorable on the stocks would point out, the multiples are high but not overly high compared to other periods, perhaps, where we could call that success? >> yeah. we'veheard extraordinary -- these companies. multiples should be based on earnings that are going to come for years and decades into the future. and the real question is, particularly in the technology space, are you sure that this company can build a ring fence around its cash flows going forward so it's going to be able to maintain the margins going

forward? because if there's a crack and if something is going to compete that away, the stocks are not worth the multiples. it's a different story for each company. look at it company by company. i get nervous when you have multiples this high because it does depend on a long string of great earnings to justify that multiple. >> i'm interested, david, to hear how when you do make suggestions that we could have a pullback and be careful from here, how that goes down whether it's internal conversations or conversations with clients? i note that, of course, completely different part of the business on the sell side of jpmorgan that marco left recently, and he was bearish, famously bearish in light of rising markets. is there a sort of nervousness in your position to talk about being careful and taking some profits, taking money off the table? does it go down well? do people hear the message?

>> i would hardly describe myself as a long-term bear. i am optimistic about equities in general. to be honest on the investment side of the business, it's a tougher job trying to predict how markets are going to do in the short run. you'll never hear me give you an end of year s&p 500 target because i think it's witchcraft trying to predict this stuff over two or three months. over four, five, six years, valuations make a difference. valuations are not important to the short run. they're very important to the long run. so yes, i think the financial advisors and investors we talk to take it seriously, and it makes sense. it's not a short-term bearish call. it's prudence to make sure you're well diversified against all sorts of risks because sooner or later something will go wrong. what i'm saying is that the markets have gotten concentrated but portfolios have gotten concentrated. it's important to be diversified not because we see some imminent threat but because something will go wrong. >> yeah. although again back to your point, i mean, it is

concentrated in the companies that are seen to be having an enormous edge when it comes to generative ai, which is generation changing technology perhaps, and to your point about moat, we've never seen capital spending the likes of what these companies are capable of doing and it's hard for me to imagine at this point anybody can even compete? we shall see. you don't seem to think it's this time? >> well, it's -- ooupg there's always plenty of money when the market is going up. i think you have to look at it name by name, company by company, and there's a danger that people just piling into some of these names. again, if you have some significant business pullback and everyone wants to cut back investments, think about all the business decisions in terms of going to invest more in ai where people say we'll hold back a little bit. we'll see if they have to perfect it. that can affect things. >> >> thanks so much. >> any time. as we head to break, let's give you our road map for the

rest of the hour. bitcoin falls below key levels. what is behind that decline and where do we go from here. >> plus today marks three years since andy jassy took over as ceo of amazon. we'll discuss the company's next stage of growth as the stock trades around all-time highs. >> and food flation. pat lafreeda tells us what he's seeing when it comes to meat prices and the health of the consumer. a big show still ahead. "squawk on the street" back after a couple minutes. (♪♪) 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

welcome back to "squawk on the street." we've talked a lot about the imbalances in this market. we'll check out communication services. the top sector at 1.5%. but only six out of 22 components are up today. meta and alphabet are up 2.6% and 1.9% respectively, propping up the rest of that group. meanwhile, the dow is now negative. the s&p is flat. the nasdaq leads the charge of the major averages up 0.4%. the russell down 0.7. the laggard as soft. >> bitcoin decoupling from tech moves trading in its lowest level since february falling below key levels. we're tracking the action and joins us with more on what's driving the declines. >> it does not look pretty. so like you said, bitcoin taking another leg down falling to a february low of about $55,000.

this move was pretty well anticipated. the trustee of the defunct mt. gox exchange had has begun repayments to creditors which it said last week it would start some time in july. that had some in the market concerned that creditors would be selling that bitcoin this month after waiting more than ten years after a resolution. now mt. gox went bankrupt after a hack in 2014. that is hitting the market in a bigger way right now. i like how grayscale framed it when i spoke with them, you think about how closely we've been watching the bitcoin having this year, that was a known positive. supply event. it lowered the amount of bitcoin supply being produced and now we have this other source of bitcoin supply coming in and sort of negating the positive effects of the haiving in the short term. it's not just mt. gox. the decline began last week when the u.s. and german government spent large amounts of previously seized bitcoin to exchanges.

coinbase and micro strategy stumbling and miners are down and in the past 24 hours, $152 million in bitcoin liquidations in the derivatives market. this is just, you know, a short-term move. nothing that fundamentally alters the positive long-term outlook for bitcoin which still has quite a lot going for it. 57 k has been the key support level to watch. that has, of course, now been breached, obviously, and if it hangs here for too long, then 49 k would become new support. >> in terms of the sort of triggers outside of the liquidation and the selling back from mt. gox, there have been other factors people have looked at over the course of the last three or four days. >> yeah. you know, it really is these liquidations. i think some have said it's been a little bit overplayed and just because these liquidations are happening, you know, it does not necessarily mean that people are going to be selling this, but we have the bitcoin etf launch at the beginning of this year and the haiving like i mentioned earlier and with those in the

past now, we really have been kind of short of a catalyst. make crow headwinds are something to watch. we're looking at the potential fed rate cuts in september but after that, i think, you know, politics is the big conversation and the outcome of the election in november is the big thing. >> great stuff. thanks so much. still to come here on "squawk on the street," historic win for labor in the uk elections. growing pressure from donors and businesses on president biden's re-election bid. more on that afterhisht eak. ts or [crowd chanting] they ignored your potential, and mocked your ambition. but it's not the critic who counts. with every swing and block, your game plan never changed. ♪♪ some still call it luck. let them. because you know what it's always been. inevitable. ♪♪

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we are developing agents... this with powers farsee beyond mortal men or you might just explode. [ laughing ] welcome back to "squawk on the street." our pippa stevens is back at hq tracking some large swings in the commodities space. pippa. >> good morning. let's start with nat gas because it is off the worst levels of the day but down almost 2% and falling to a seven-week low. you can see that last month there was momentum behind this trades that heat wave swept the u.s. which briefly pushed the contract above that $3 level.

but we've seen some production come back online, that had been sidelined and storage also remains a big overhang here. there's about 20% above the five-year average and that really needs to be worked through before the trade can reverse. now earlier the earlier this week we did see nat gas turn negative on the year now down about 6%. moving over to copper that is catching a bid at the highest since may and pacing for its second positive week in seven. it is getting a boost thanks to a weaker dollar with citi pointing to china policy optimism and a jump in fed rate cut expectations following the weak services pmi lifting copper stocks the copx on track for its fifth straight positive day, glenport and free port are in the green. on the flip side energy stocks are under pressure. the refiners and the gas drillers like eqt and coterra are leading those declines. wilf. >> thanks so much. let's return now to the uk elections. keir starmer confirmed as

britain's new prime minister following the labor party's deceasive win. we should mention uk markets, all european markets have turned south in this final afternoon trade of the week. the ftse down 0.6%. it happened you up about .5% in the session. rates cut expectations for august tick above 50% again to about 65%, but that was more in light of rate cut hopes rising here in the u.s. off the back of the jobs numbers than the election specifics. he's got a massive majority start of a five-year term and picking his cabinet as we speak. a lot of his shadow cabinet entering into downing street expected to have that announced fairly soon. as we were talking about it earlier they get on with it in the uk. by the way, we should mention one likely almost certain wildly surprising if this wasn't the case, the likely chancellor of the checker, rachel reeves the first ever female chancellor of the czecher.

i did talk janet yellen about it, skillful saying i'm not going to get involved in the election but any senior post in finance and business for women is always something i celebrate. we've had female prime ministers before, so it's within that context. >> what do you expect to see from rachel reeves in terms of policy pushes and policy priorities for the uk. >> it is worth reminding in this election campaign in order to play it safe in order to win and learning from past losses under jeremy corbyn further to the left, keir starmer the labor party tacked center and tried not to create wedges on tax and spend where they could with the conservatives. slightly more incentives to increase taxes and spend more but nothing game changing like you might have expected between laborers in the past. the policy that got the most attention which actually is indicative of how insignificant on the grand scale of it is on introducing attacks on private education. at the moment in the uk that's

exempt from value added tax that gets adds to all services and goods. it's 20% in the uk. because private education is a charitable institution it doesn't have that tax. school fees for those that pay private education will go up 20%. it's quite divisive for those affected but only 7% of parents send their kids to private education in the uk. it's quite focused. it caused fury under a small group of people bunt if that's the biggest big difference on tax it won't be anything else. they pledge not to increase income tax. there are a few other taxes that affect a lot of people that they didn't pledge as explicitly on but they -- nor are we expecting big tax increases immediately. >> was capital gains tax a big part ofa discussion? >> capital gains tax where people wonder if there will be a means tested aspect. the highest people in income tax brackets might see a tax on the property taxes which are

structured differently than they are here. we'll watch that but one thing is key. rachel reeves has said everything we do will be fully funded. it's not going to be i guess the other question people had, like the liz truss experiment of unfunding spending promises to lead to more borrowing and they will play it safe surely but surely. they have a massive majority they can pretty much do what they want with, but certainly in the early terms to go away from the manifesto would be seen as a big surprise. rachel reeves uds to work at the bank of england, an economist by trade. she wasn't in keir starmer's initial shadow cabinet when he became leader 4 1/2 years ago. came in during that process as he did tack a little bit more to the center and she's seen as important in that move that he made. >> good to have you here, wilf, on this key day. >> it's amazingly fortunate timing on which note we didn't know when the election date was going to be. rishi sunak called it in a

surprise. both he and macron incumbents that got smashed in the polls, but also incumbents that didn't have to go to the polls yet. particularly on the conservative side it's the biggest loss in history for them and part of that was calling the election at the wrong time. a lot on rishi sunak's shoulders. >> six weeks and done. >> transition done in hours. >> let's turn to u.s. politics which takes a lot longer. kristen joins us now. costs a lot more as well. that's the subject we're dealing with right here because president biden is facing growing pressure from donors and businesses for that re-election bid. i know you have more on that story. >> absolutely. thanks. pressure is definitely mounting on president biden. a small but growing number of major democratic donors are now publicly calling on biden to step aside. netflix co-founder reed hastings was one of the first shared an article on x on why biden must

resign. abigail disney told cnbc she would be withholding all donations to the democratic party until biden drops out. the screenwriter david linlove wrote an essay for -- to checks written to any democrats until there's a change at the top of the ticket. whitney tillerson arguing if biden does not step aside he will lose to trump, possibly he says in a andslide. it's not unanimous. a lot of donors and fund-raisers say they see things today as mostly in a holding pattern while people wait to see how biden's interview with abc news goes this afternoon. dim metry melhorn, reid hoffman's advisors, the two leading the charge in defense of biden sent an e-mail last night urging democrats to see why biden is the only one who has and can in his view beat trump. the biden campaign is pushing to retake the narrative today capitalizing on their recent fundraising haul to launch a $50 million ad blitz for july, planning campaign travel to every swing state and in a clear

reaction to the events this past week pledging to make biden available for interviews including off the cuff remarks. it's a full-court press at this point on both sides of this fight and can't be overstated how crucial biden's public events will be for the future of this campaign. guys. >> meghan, thank you very much. still to come, goldman's chief economist jan hatzius will give us his read on today's job numbers. we're back in three. 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

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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. welcome back. i'm silvana henao with your cnbc news update. nato will continue to support ukraine at the same level for the next year according to nato secretary general generals soltsen berg and reiterated that ukraine will not be considered for nato membership until the

war is over. meanwhile, fire crews are fighting off another wells fargo in california today amid extreme heat. the french fire began in mariposa county thursday and it's 5% contained this morning it has already burned about 850 acres and put almost the entire town of mariposa under a mandatory evacuation order. nearly two dozen wildfires are currently burning in the state. and after delivering a powerful punch to jamaica, hurricane beryl made landfall this morning in ta human, mexico, as a less fierce category 2 storm. forecasters say beryl is expected to weaken into a tropical storm before it re-emerging in the gulf of mexico and likely becomes a hurricane again. wilf, back to you. >> great stuff. thanks so much. lovely to see you. we just had confirmation of what we discussed moments ago and rachel reeves has been confirmed as the uk's first female

chancellor of the exchequer, finance minister and tweeted as well, it comes with a hiser toic responsibility as the first woman to be appointed to chancellor. every young girl and woman reading this there should be no limits on your ambitions. confirmed by prime minister sharma as his finance minister. the economy added slightly more jobs than had been expected. the unemployment rate, though, now at its highest level since october of 2021, it's now 4.1%. here to help us dig into the numbers is goldman sachs' chief economist head of global investment research jan hatzius. always good to have you. you were a bit below in terms of where we came in. you know, just give me your take overall on how many jobs were added and also there were significant revisions in the last two months. >> yes. the headline number for june was higher than we expected at 206,000, but if you look at the

private sector number which was meaningfully lower and a lot of job growth accounted for by health care, once again, with some weakness in the cyclical sectors, alongside that some big downward revisions as you said, an increase in the unemployment rate to 4.1%, all of that means it's a decent report but it is a bit softer overall than i think widely anticipated and business wide the rates market rallied on the number a bit. >> now we're seeing 75% chance of september cut. you mentioned softness. is this what you want to see, though, for a soft landing, so to speak? >> i think it's a soft landing kind of report. it i think will reassure fed officials that the labor market has continued to rebalance. wage growth also has come down, we're at 3.9% now for average

hourly earnings and the more important report is probably next week when we get the cpi for june in terms of what the fed is going to do, but i think this does support the idea that they will cut relatively soon and we continue to think september is the most likely. >> the rate complex moving in reaction to some of the uncertainty on the political front here in the u.s., i know that you have been studying the plan proposed by former president donald trump and the impact that might have on interest hikes? >> well, it certainly would have -- if there is a significant increase in tariffs it would certainly raise inflation in the -- you know, in the near term. we estimate that a 10% across the board tariff would add a little over 1 percentage point

to inflation in the year after it is instituted and that could have implications for interest rates as well. i don't think it's going to have an impact on how the fed is going to agent over the next several months before the election. they're very focused on the economic data. they've said time and time again that political considerations don't come into it, and we take them at their word. >> is there a reckoning to come on the fiscal imbalance, whoever wins the election in november in the early part of next year? >> well, i certainly thing that over time, we will need to see fiscal consolidation. we're looking at -- at federal deficits in the 6% of gdp range, pretty much as far as the eye can see. there's no comprehensive plan on the table in terms of really bringing that down to more sustainable levels.

whether, you know, at what point that occurs and at what point it really needs to occur it's very hard to say, but over the next several years, i do think it is a really central part of the u.s. economic and policy outlook. how we get fiscal consolidation and it is becoming more important as time passes and we see these very large deficits continue. >> you know, perhaps worth noting that you did write this report about the upcoming election on july 1st. is it becoming more and more of a priority so to speak in terms of the macro outlook for your client base at this point and does it dominate over the next couple months then sort of a lot of the thinking. >> well, it certainly as it draws closer it will become more important for markets and for investors. i would say at the moment, a lot of the market moves and a lot of

the discussion is still about soft landing versus sharper downturn, inflation, fed cuts but i would expect that to changes we get past the summer and into the fall and really into the whole phase of the campaign. >> yeah. pooinl, you're expecting are one cut this year or are you a two. >>? we have two cuts. a you cut in september and a cut in december. so basically a quarterly pace, similar to what we have seen with other central banks. the european central bank, very likely to cut again in september, and we're seeing that probably in canada as well, and i think this is the sort of soft landing cutting pace that we are seeing in the g 10 economies. >> jan, thank you. enjoy the weekend. >> thank you staying with jobs our kate rodgers is looking at one sector continuing to experience a tight

labor market. hey, kate. >> hey. the need for workers in the chip sector from technicians to engineers and more is being felt across the industry with the recent study from the semiconductor industry association prot jiktsing a shortage of 67,000 workers in the sector and a broader gap of 1.4 million in the economy in 2030. global foundries is a maker of chips from phones to appliances and supplier to big companies including gm. it's actively recruiting for hundreds of roles across the globe. morgan woods started out as a chips technician and today is a training and development analyst overseeing other technicians. >> as the demand for the microchips increases, we definitely need more manpower to help support the constant rollout of microchips and meeting our daily targets. >> now to help fill its talent pipeline at its facilities in new york and vermont the company launched an apprenticeship

program that requires a high school degree and interest in hands on work and a willingness to learn new skills. >> if you're not getting traditional talent cross-training talent, identifying ordinary talent pools, people who are in different fields, showing them that this is a very well-paying set of opportunities that exist within the semiconductor industry is our approach. >> global foundries announced in march $1.5 billion in planned funding from the chips act. this combined with state level funding is expected to create over 1500 manufacturing jobs in about 9,000 construction jobs over the lifetime of several projects it currently has. both of those sectors also do have worker shortages as well. it's very key that they find all this talent. back over to you, wilf. >> thanks so much. still to come here on "squawk on the street," consumers feeling the heat when it comes to inflation. the higher food prices impacting

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much more to come throughout the morning here on cnbc. on "money movers," the white house council of economic advisers chair jared bernstein will join leslie and i and discuss today's jobs report and the growing pressure facing president biden and his re-election bid at the top of the hour. we'll be right back here on "squawk on the street" in just a moment.

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. fourth of july cookouts are feeling the heat of inflation while overall grocery costs have stabilized. the average barbecue for ten people will cost about 30% more than it did prepandemic. joining us now path lafreeda celebrity butcher and ceo of pat lafreeda meat per vaers. thanks for being here. give us a sense of what you're seeing in sense of pricing for meats sold in restaurants versus those that are direct to consumer. >> well, prices are up in both, and it really has to do with supply. supply is low, and it doesn't seem to be able to correct

itself any time soon. >> you've also historically noted the cost of logistics in delivering meat to sid video restaurants. is that still an issue as well? here in the new york area, they umtsly scrapped the plan for congestion pricing. i'm curious if and paying too much for it. so, you're going to see attendance in restaurants, it's going to be lower this season, as beef prices go up and our costs, especially cost to deliver. trucking is very important.

as those rise, restaurant prices must rise. labor is at a very high rate. a and, you know, put all those things together, with the low supply of cattle, we're -- you know, we're going into some very dark times for meat prices. >> pat, i wanted to take this in a slightly different direction with a simple question, which is in your view, what is the best cut of beef to make the best burger? >> maybe we can't go in that direction. looks like we might have lost the connection with pat. >> that looks delicious. >> that is a shame. >> that's such a tough question, he couldn't even answer it. >> i like bison. >> wow. >> a little healthier, too. >> what's your favorite type tie of steak?

i go for lean. >> kansas city strip, obviously. >> but for burgers, you want a bit more. he's back. pat, you had time to think of the answer. my question was, what is the best cut, in your view, of beef for a burger? >> i'm the third generation to come to this conclusion but it's outside skirt steak. but you're asking what's the best type of beef for a burger? >> that's right. >> whole cuts of beef, which our family recipe calls for two pif piece chucks, which is the chuck and clod and the brisket. down south in barbecue establishments are not happy with the amount of business ket we use in grinding but it happens to lend an amazing flavor. in part of our recipe for three generations. >> pat, real quick to come back to something you led with. explain to our viewers what is going on with the supply of beef and why it's so tight. >> well, we are facing a

drought. and i think that right now with the -- we already started with low beef supply. and anything that -- any slight thing that could affect that supply chain is going to affect pri pricing. and in this case, it's the drought. i have to say, throughout my entire career, i've always heard this same rhetoric about the -- about a drought affecting beef, but it's ever so true here. and the price of labor, it's very high. so -- and there's -- most of our product is all natural, never ever, no antibiotics, no growth hormones. that beef is even at a higher rate and continues to increase. to the point where if the economy stays like this and, you know, there's great demand for beef, but at the same time, there's not as much money to

spend on it due to the high prices, that demand for antibiotic-free is starting to slip a little. >> yeah. a clear supply and demand 101 test there, pat. thank you very much. who says that it's dark times for meat prices. >> all i know is i got hungry looking at those cheeseburgers. >> seriously. today marks three years since andrew jassy took over the top job at amazon. the stock has lagged a bit, at least in terms of its other big tech peers during the period. only up 13%. larger gains, of course, companies such as meta, apple and microsoft. kate rooney is taking a closer look at that, at the jassy era so far and what the plans are for the future. kate? >> andy jassy took the ceo job when amazon was growing quickly to keep up with demand during the pandemic. that growth era ended abruptly and one of jassy's biggest challenges has been adjusting

and cutting spending around that. investors see his biggest win is getting the e-commerce business back to profitability and bulking up advertising as well. the online shopping has helped the stock lately, back within all-time highs and margins are growing after falling into negative era during the pandemic. that's a result of the major investment cycle amazon went through, paying off. better logistics bringing down cost per package and prime memberships. sports has been spending big with nfl and nba rights. for prime, advertising on prime has been applauded by wall street. but cloud growth has fallen under growth to low of 13%. that surprised some investors based on jassy's experience. he actually founded aws within amazon. he ran that business. it has bounced back and amazon was a first mover in cloud but now faces a lot more competition from the likes of microsoft and

google. the perception within tech communities is amazon is behind in a.i. this has been a big theme. they don't have a large -- leading rather large language model, and they have been giving a look at anthropic and alexa has been a disappointment in a.i. investors tell me this is jassy's big test, to lead in a's and the billions they spent on starting anthropic, data centers. that's all going to be worth it and pay off. amazon has pushed back. they say a.i. is already multibillion dollar revenue within amazon but that's a show-me story when it comes to a.i. >> kate, thank you. stock this year has been up some 31.5%. outdone bit likes of meta, as kate pointed out, up 39% and another 3.4% today for shares of meta. not seeing any real news, but at this rate, zuckerberg's likely

to start hydrofoiling in a tuxedo in a beer with one hand and an american flag in another every day. >> that's what it is. >> look at the reaction. >> born in the usa. >> more importantly is whether we're going to see jensen huang, bezos and others -- >> using a.i. to do it. >> i guess -- >> which fall of the mag 7 ceos could do that, do you think? >> i think only zuckerberg. i'm going only with zuckerberg. wil wilfred, it was great to see you this week. >> give the challenge to musk. >> are you here next week? >> no. it's been a pleasure. thanks for having me. have a great weekend. our live market coverage tethwoig with these t rht afr is.

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. good friday morning and welcome to "money movers." i'm leslie picker with wilfred frost live from post 9 of the new york stock exchange. coming up, jared bernstein with the jobs