good morning, everybody, welcome to "squawk alley" i'm carl quintanilla with jon fortt, morgan brennan coming to you live on this wednesday from various locations. pretty good market day as we get losses back from tuesday, all 11 sectors are higher on this day where all 50 states in america have some level of reopening markets on pace for their best week in about six weeks. and, of course, a big day for retail earnings out of target and lowes. for that we start with courtney regul reag reagan. >> the split between essential and nonessential in these numbers is probably not surprising if you were essential you probably picked up sales others lost but we did hear from two essential retrailers, let's start with target. they posted full results this morning including comp sales of 10.8%. online sales grew 141%

which means they were the vast majority of the comp sales the in store sales were .9%. the stores fulfilled 80% of the digital orders in some way brian cornell said the retailer will spend $500 million from the beginning of march through july 4th on higher wages and other operational expenses related to the covid crisis so this spending goes beyond q 1 into q 2 not directly comparable with what we heard from walmart yesterday. the sales came at a cost their operating income margin was 2.4% compared to 6.4% in the same period last year and the gross margin rate was 25% compared to nearly 30% last year but then look at lowes, michael baker calls lowe's perhaps the most surprising result of the quarter for retail their comparable sales grew more

than 11% total up more than 12% in the u.s. that's only the fourth time in at least ten years we think that lowe's beat home depot in the u.s. both retailers had identical online sales growth in the quarter of 80% but that is a huge growth compared to last quarter at 3%. lowe's said it had $340 million in covid-19 related spending and it's really soared past expectation. brian cornell of target called the quarter stressful for the country and retail but the results showed they were able to at least deliver on the sales. so many questions remain, though, about what is going to be permanent and what is going to be temporary with some of the trends wea've seen in retail

getting past this crisis. >> which is why i'm sure the guidance has been pulled thank you for bringing us the latest on the retail break down. bio tech and pharma also on the move this morning. our next guest's company signed a deal to produce generic and covid-19 drug ingredients here in the u.s., drugs that have fallen in short supply since the pandemic we're joined by dr. eric edwards. thanks for being with us today >> good morning. >> so you just got awarded this very significant contract by hhs earlier this week. certainly we've seen experts ringing the alarm on u.s. dependency on china for raw materials and drug manufacturing in general for quite some time, the pandemic seems to be accelerating that. but there is an industry, at least to a certain extent, here in the u.s. that exists around contract manufacturing how much is this focussed on

producing drugs versus stockpiling and developing those raw materials? >> great question. flow corporation's mission is to provide high quality low cost pharmaceuticals and their ingredients. so it's both flow corporation is not only going to make the essential medicines along with our partners but we're also going to be using advanced manufacturing, continuous manufacturing technologies that has been p proven to lower the cost of active pharmaceutical ingredients so our goal is to stand up the infrastructure and we're working with partners already to begin manufacturing essential medicines in shortage today for covid-19 >> so phlow is only what a couple months old right now. how quickly can you produce these drugs and materials? especially given the fact you are just now starting to build

out your facilities? >> sure. the work actually began over a year ago we began working with a team and built a world class team, world class partners we were trying to figure out what type of corporation structure could highlight the impact mission, then once we figured we could do a b corp. structure we put it together in january. then we were getting to work on how we were going to manufacture these and which drugs were most vulnerable these were drugs in shortage long before covid-19 then we put together a proposal involving rapid surge for ingredients at risk of shortage right now, get them to the stockpile and ingredient reserve. and second build the rapid infrastructure to bring back end-to-end domestic advanced manufacturing from precursor

chemical to api to finish dosage form we should be up and running in a year >> thanks for being with us. it's jon fortt what's it going to take for phlow to compete in the open market on not just ingredients but finished drugs and how far out is that? >> great question. and an important question. so phlow is incorporating advanced manufacturing development. we were founded with our cofounder at the medicines for all institute who had proven over the last three years that he could reduce the cost of active pharmaceutical ingredient manufacturing by upwards of 40%. so the first goal was let's use advanced manufacturing technology that has not been incorporated for generics here in the u.s the second is let's realize supply chain efficiencies. for example our manufacturing

partner has figured out a model to produce affordable generic medicines here in the u.s. with our 1,300 hospital system partners so we'll realize efficiencies in the system to drive competitiveness and bring back the important industrial base >> eric, you know when we talked about -- when we've been talking about bolsters domestic supply chains for a long time, and the question was where are they going to find the workers to do that, train the workers to do that, certainly that's not acute a concern given what unemployment is doing and about to do, but what will hiring look like and how easy is it to transfer some of the skills? >> so we have already over 20 employees, we're growing every single day within the next few months we'll have over 50 employees we have not had a problem attracting world class talent. a lot of individuals are raising their hands saying i've had

successful careers, some of them have been in retirement, i want to work on something now significant. this is significant most importantly for patients and the health of americans. we have fantastic job opportunities. we'll hire up to 350 employees in virginia. some are highly technical jobs, forei fortunately some are manufacturing jobs where individuals have been out of work or previously worked at facilities we're linking to as part of the project. so we're proud to put americans back to work in american factories. >> in a week, dr. east sidwardse moderna is in focus for the medical communities and investors given the vaccine development there, in general are you going to be involved in manufacturing vaccines if and when the time comes? how quickly can the stockpile of vaccines be ramped

are you involved in operation warp speed >> great question. so as a part of this federal award with the research and development authority underneath hhs, we are building an end-to-end manufacturing structure which also includes a fill finish facility that facility will begin breaking ground and working on that facility very soon. and as a part of that contract, the federal government does have the option to utilize expansion space that we have included in the plans for vaccine manufacturing. right now our focus is on the essential medicines that are in shortage to treat hospitalized covid-19 patients but certainly we'll be partnering with the federal government to make sure we utilize this important american infrastructure for whatever the needs are as a part of the covid response. >> there's been a lot of talk over the past few years especially about moving manufacturing back to the u.s. sometimes it gets talked about in terms of iphones and pcs and

things like that but what i keep hearing from industry is that if you move manufacturing from low cost countries to the u.s. it looks different. there won't be a lot of human beings employed in those manufacturing plants certainly not as many as are in china, for example i wonder for your operations if they scale up beautifully, perfectly, the way you would hope, how many human beings are going to be employed in those facilities versus mae versus mad how much economic boost will it give the area you base them? >> first and foremost, as you know up to 80% of active pharmaceutical ingredients and precursor chemicals are made abroad phlow is not against a global supply chain but we're for making sure we have an end-to-end solution here in the u.s. to prevent vulnerables that

can occur in the supply chain. we need that here in america so as part of that, you have to have multiple infrastructure to do that. one of the things that phlow is doing is we're standing up the first strategic act of pharmaceutical reserve, this is modelled after the petroleum reserve. instead of drug products in the national stockpile, we'll be holding the ingredients. that requires a lot of work. stability work, analytical work. we'll have hundreds of jobs focussing on multiple efforts, not just the manufacturing you are correct once we get the continuous manufacturing plant up and running, there will be less human being capital that has to be employed on that element, but there are many other elements part of the plan that are going to require a lot of high paying and great technical jobs. >> that's interesting to hear

you talk about the spr, a lot of what you're discussing reminds me of what we've seen in terms of standing up the defense base as well. but i have to shift gears. for better or worse there's been issues about your last company, issues around the price of a drug offered by them to counter overdoses. how do you respond to critics that point to that background? >> i respond that i'm a co-founder and co-inventor of multiple drugs that have saved thousands of lives i left that company over 18 months ago and i was in charge of r&d, not on the commercial and never made a pricing decision but those kaleo drugs have saved countless lives. >> in terms of the fact that

phlow's contract with the government represents this public, private partnership, what does it mean for prices >> it's set up as a public benefit corporation. we did it to have social impact. we put independent board members on the board to hold us to our goals, which means affordable medicin medicines, one of the reasons we partnered with one of the nonprofits in america. phlow is about putting the people, planet and patients before profits that's one of the reasons we're taking this social impact model. >> dr. edwards, thank you for joining us congratulations on the contract. >> thank you. and john thompson is with us ayitus other side of this break. we're back in two. with pure pr. high protein. low sugar. tastes great! high protein.

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microsoft partner, and light speed. there's a start up that i certainly want to talk to you about. but john, first of all, thanks for joining us and good morning. >> good morning and thanks for having me. >> always great to have you. first, let's take a step back. tell me about large tech companies and the factors that they're looking at dealing with this a lot of them have big cash hordes, a lot of resources, but at the same time the big customers who are -- who would be dealing with them, perhaps are strapped what are they trying to balance and what do you expect them to do from here microsoft, included but i won't ask you specifically about just microsoft. >> all right i think in any economic crisis like the one we're going through now, any company has to go through some evaluation of where i am and how do i get to where i want to be over the course of the next, let's say, 24 to 36 months i think every large and small

company is going through that exact same exercise right now. the unfortunate thing is we don't know enough about when the end for covid-19 might occur so every one of these companies is going through an evaluation process that assumes multiple l legs however, every one of them knows they're going to have to take some cash cuts or at least some expense cuts in in the short term and there may be head count related issues as well so every company, large or small, is going through that today, in light of the environment we're operating in. >> usually when there are expense cuts and potential head count cuts we see it in contract workers first, might see it in the sorts of incentive bonuses that are paid to partners in the sales and reseller is that what we're seeing now? and how long before we know whether it gets more dire? >> well, i don't know how long it will be before we know

because we don't know when this is likely to come under control, that is the virus itself as opposed to the economic crisis that is the back end of that i think when we look at where we are, there are many, many companies that are going to go through this exercise. i have several in my portfolio already who said we're taking a set of actions now and within the next 90 to 120 days we may have to take another set of actions as well. this is going to be an ongoing exercise for every company as we go through this crisis. >> tell me about the m&a landscape. the ceo of microsoft just announced during a conference yesterday that microsoft had made a strategic acquisition i think that's interesting i think there's a question about how much of that can go on during this period on the one hand there's concern that big tech companies will take advantage of those that are cheap but then on the other hand there's a lot of start ups that

would like to be acquired and keep business moving during this time how are you thinking about m&a and what's appropriate to do, what's necessary to do during this time? >> i don't think this crisis changes the way about how companies think what they need to add to their portfolio. many of the transactions that microsoft has recently announced they've been engaged with them for quite some time before announcing the actual deal this week or last week. i think the same is going on for every large tech company they're looking at footprints or capabilities that they'd love to add to their portfolio and trying to determine whether or not that's an asset they can acquire during this period of time not uncommon for what goes on during these financial crisis periods. 2008, 2009, the exact same thing happened. >> john, i want to go back to

the labor market whether it's through the microsoft lens or the vc lens as an investor. will tech hiring rebound quickly, and how will those jobs look will they be different given the fact we're seeing more companies tell their workers they can work remotely or stay at home >> as i said earlier, we don't know when the end is in sight. it's not in sight at this point in time. so being able to forecast what companies might do on the hiring front is difficult at this point. >> yeah. >> i would say every company is looking at its head count pool today and trying to determine, are there areas in this aggregate pool of resources that we have that aren't necessarily going to be with us as we move forward? i think, as you think about consumer facing businesses, as you think about businesses that really do have an online outreach, all of them are going to have to expand, if you will,

their footprint in such a way they can reach customers without having to necessarily be physically engaged with those customers. i think it's easy for consumer and enterprise companies but the enterprise companies have to think about how they package the plukt products and deliver them to customers to deploy the services quickly without having to have physical engagement along the way >> i'm curious how you're thinking of liquidity. we have this conversation a lot with our guests because you can come at it from a defensive point of view, meaning you need a large rainy day fund to survive the economic effects we're still about to see, but then you can also take an offensive point of view, and that's you want to launch some m&a efforts as you take advantage of competitors who have been hobbled, how do you think about that >> again, i think every company is going to go through this evaluation i'll give you a classic example

of a young company where early in this process they decided they needed to have 36 months or more of cash on their balance sheet. as a result of that they took actions that reduced spending by about 35 to 40%. and that will, in fact, give them leverage. ironically enough, the growth rate of their business has accelerated since that time. because they're in the ecommerce space where they're doing b 2b commerce and every company looking at how do i grow, their bigger competitors could that be a great addition to my portfolio? this is going to be an interesting time on m&a as well as young companies emerging from this period of time as the hot tickets if you will for the next five to ten years. >> let's talk about your portfolio more security start up that raised a series a last july 9 million on that, i believe, 20 million

series b now it's in the space that i'm hearing a lot about over the last couple of years, kind of smart detection of threats how do you sort out kind of signal from noise in that space since it seems every security startup is claiming to be able to do that smart, surgical detection? and what are the metrics that you as an investor are watching within this company as it seeks to continue growing and hiring in this crisis >> it's about a 2-year-old company and they had an idea when i first met them that was all about not just real time detection of a threat but real-time blockage of the threat that's not something that many, if any, security companies had done prior to that that was what prompted me and lightspeed and others to consider it in the seed round. what's happened for the company in the last two years, they've not only gone from a cloud-based

service but recognized through the engagement with customers they had to have an on prem offering as well so they've built a really, really capable product that allows them to detect and block real-time threats showing up in large enterprises. they've had great success, seven or eight customers so far, however one of them is a u.s. federal defense contractor that really does position them to do very, very well. not just in federal but more broadly in the enterprise space. >> interesting i wonder, john, just to broaden this out further where do you see the greatest opportunities to invest in the private market right now and what are the metrics you're evaluating more broadly when you look at companies and opportunities? >> that might be a better question for a partner at lightspeed since much of what i do helps our portfolio

companies. >> okay. >> and what the company does as alternative for investments. often i'll say i like that and i not only like to investor from the fund but i'd like to invest directly in the company. which is what i did to a couple security companies in our portfolio. i'm not the guy at lightspeed to make the choice but i work hard to make the company scale and become very, very successful. >> to close along those lines, what is the advice that entrepreneurs these days are asking you for young ceos trying to build their companies and another but related question, what's the insight and advice you see they most need? perhaps that they're not asking for, but that this generation really needs to hone in on to grow those companies to their full potential >> the contrast that these companies have right now, some of them are growing very, very

well but recognize there are actions they need to take to position the company post this crisis and so, that's a tough, tough challenge for many of them i've had several of the ceos in our portfolio say the growth rate is x and equal toor bette than expected but we need to take some actions here or there. so ichb an adviser to a number of companies saying if you think there are quality issues, head count capacity related issues, you need to take action now, don't wait that's the thing i think most important for every leader during this period of time don't defer a decision if you have a point of view, execute on it and move on so you're prepared todeal with whatever occurs downstream two months from now or two years from now >> tough advice but necessary. john thompson, chairman of microsoft and investor thank you for being with us. >> thank you, appreciate it.

as we see sessions highs here, s&p up, dow up 434 look at the airlines as well as we get continued anecdotal evidence that traffic does at least not get worse. looking at 5% increases in the stocks y r e rline index above the 50 dafothfirst time since mid february on your interests or what's trending. get real-time insights in your customized view of the market. it's smarter trading technology for smarter trading decisions. fidelity. and its mission is to give you truly transformative sleep. so, no more tossing and turning... or trouble falling asleep. because only tempur-pedic uses proprietary tempur® material... that continuously adapts and responds to your body, to relieve pressure... so you get deep, uninterrupted sleep. all night. every night. the tempur-pedic summer of sleep starts now, with all tempur-pedic mattresses on sale,

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averages rebound for stocks today with the dow, s&p and nasdaq erasing yesterday losses the do you up 1.8% the s&p up 1. 9% and the nasdaq up 2.2% stay with us

good morning and welcome back everybody i'm sue herera. here's what's happening at this hour the centers for disease control and prevention quietly released guidelines today for how to safely reopen schools, mass transit and nonessential businesses the plan outlines a three phased approach for reducing social distancing and suggests that the potential for a rebound in cases will require a low threshold for reinstating strict measures. jetblue will keep seat distancing in place through july 6th. the airline is blocking middle seats in rows where parties are not traveling together and

blocking aisle seats on smaller aircraft. nearly 80% of unemployed americans describe their layoff as temporary but new research shows that 42% of layoffs due to the coronavirus will become permanent. that is not good news. jon i'll send it back to you. let's hope it's not as bad as that, sue thank you. the ceo of trivago joins us after the bareak we'll talk the impact on travel and leisure and recovery stay with us ted? depends. are you gonna want faster speeds? i will. more reliability? oh, also yes. better response times? definitely. are you gonna be making sourdough bread? oh, is that 5g related? no, just like why is everyone making sourdough now...

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online travel site trivago seeing declines in its business from a year ago. the ceo joins us this morning to talk about travel and the road ahead after the pandemic axle thanks for the time today, good to see you. >> thanks for having me.

>> sad to say no one is -- can really be surprised by some of the revenue forecasts you're making for 2020 but are you of the camp we're hearing increasingly, especially from some of the airlines that it does seem that may and june are going to be better than april and march? >> it's a matter of what you compare against. so the travel really stopped end of march and we had more than 95% lower revenue than a year ago. and we've seen the last couple of weeks some recovery, in particular domestic travel, particular to beach destinations, but on a low level. but relatively speaking to a few weeks ago, more and more people are comfortable in traveling and are reingauging but the levels are far below what we would normally see >> one of the things you pointed to is a lack of a universal standard for what it means to

travel safely, to come into a new country safely are you seeing that sort of patch work get stitched together more quickly in asia or europe or -- i mean, within the continental united states? >> that's very difficult to say. because the -- i think it's not a one-way street so you have, in particular in europe and the u.s., different regulations by states by national states but then also by regions. and then in some countries, even like for example in germany, the plan is to reimpose restrictions, actually even on a city level if the number of new infections are rising by a certain threshold. so from a traveler's perspective it's difficult to know where you can travel and what kind of experience you are expecting in destination. >> it's jon fortt, good morning.

the ceo of the u.s. travel association says that the travel industry is in a depression. 51% of travel related jobs have disappeared since this crisis started. even best case scenario, how does this scale up how quickly? >> so our view is that it will take a long time, and the reason is, i mean, there are a couple of reasons, one is obviously that we are at the same time in a deep recession, so that has a negative impact on traveling but more importantly, this crisis is a health crisis and a health crisis is very personal and so, depending on your age, your health condition and also your personality, you perceive the real risk that is out there very differently and it will take some time to get comfortable with safe travel when it is possible and then it

will be very different person by person we think the safest assumption is it would be a gradual step by step recovery where more and more travelers are getting comfortable and by traveling getting others more comfortable. >> so what would you say the industry needs to do maybe in terms of communication or standards to get people comfortable traveling as quickly as possible? >> i'm not sure that getting people traveling as quickly as possible is the right objective -- >> no, get them comfortable traveling. >> yeah. >> when it is safe, what kinds of communication and standards are going to be necessary so people will say i understand what's going on, now i'm willing to do? >> it's information and transparency so what is actually the experience that you are facing in destination, will restaurants be open? what kind of restriction are you having to expect and what kind of vacation or what kind of trip

do you expect? that's something that we are working on to give that transparency to potential travelers, the more information you have access to, the more comfortable you will feel ahead of the trip. >> given the fact that we're having the bigger conversation right now what this could look like and the uncertainty over coming months, what does it mean for trivago and how is it dictating or helping shape the way you are now looking to draw more people back to the platform >> so they -- the most important thing for us is to accept the travel temporarily disappears and that frees up our mind to focus on the situation we're now facing, what kind of travel is the first to restart and how can we help travelers to get comfortable, as you say. and there we added a couple of functions to our existing

product showing more prominent free cancellations which reduces risk of traveling. and locally we're building a travel product what we can see in the u.s. but particularly in germany and europe where there is traveling starting the first trip is in your car to a destination you can drive to so local travel is the first thing that is coming back. we think it will be important to get comfortable with more long haul travel and we are building a separate user product to support local travel and to offer information what are actually interesting destinations in driving distance you might not have considered otherwise or might not know they are interesting destinations >> certainly makes sense that people would be gravitating towards things like road trips one of the things you mentioned in earnings is you're

gravitating toward more tv advertising versus search engine marketing on platforms like google why? >> so we need to learn from the past the industry is restarting really from no activity to the new normal in a couple of years from now and one of the challenges in the industry in the past has been a large share of the industry profits has been captured by search engines and we have started to do some tests on what the right activity, marketing activity of ours on search engines is before the crisis and had some indications that the level was beyond what is actually optimal. so, taking that learning now to the restart, we think that overall we'll be a lower level be reached going forward and that allows us to redistribute some of the marketing budget into brand, which has been our historic strength.

>> finally, even as we're talking this morning, spiegel has a headline now that germany has agreed on a rescue package there was an earlier headline about air france this morning, they're going to retire their a-380s international travel seems structurally challenged. are you of the view to get back to transpacific, transatlantic travel you're talking three to five years or maybe even longer than that? >> it will take a long time. i'm not the air travel expert, to be honest we offer accommodation but business travel will be suppressed for quite some time and international leader travel is, from our perspective, the last to come back, it's furthest away from home you get on big planes, go to a country you don't know and that automatic mat cli makes you less comfortable and this feeling of

every trip being safe no matter where you go we had just a few months ago i think will take years to rebuild >> let's -- and hopefully medical break throughs can accelerate that return to normalcy thanks for the guidance on this, triva trivago's axle heifer. >> look at shares of harley davidson, those are up sharply this morning, 7.5% companies reopening u.s. factories though at reduced rates, sending dealers fewer cycles but the stock still down more than 35% so far for the year we'll be right back. stay witush on your interestsed or what's trending. get real-time insights in your customized view of the market.

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the sprawling estates and mansions that have languished on the market for years are now getting a second wind in thanks to covid, in part. our robert frank has more on that this morning. hey, robert. >> reporter: good morning, carl. wealthy new yorkers leaving the city are now looking for the three ps property, private, and a pool. and the biggest states in westchester, new york, and northern new jersey that sat on the market for years with a lot of price cuts are now back in demand this four-acre waterfront spread in greenwich just sold to a family moving out of the city. price tag, $17 million, making that the most expensive sale of the year in connecticut. it's got views of the long island sound, formal gardens, and your own golf green. now, the stone mansion in alpine, new jersey, that's been on the market for ten years. it had its price cut far enough $65 million to have $36 million. last month, a potential buyer toured the property and offered

to rent it for $500,000 a month. that's just to rent it the owner turned it down in hopes of a sale. and the late leona helmsley's former 40-acre estate in greenwich called round hill mann manor that had been listed once for $50 million dropped last year to $16.5 million because of a lack of buyers now, the broker says he's had seven showings just in the past month and there is serious interest, because 40 acres, guys, could buy you a lot of social distance. back to you. >> it sure could, robert and a lot of home offices, too robert frank, thank you. >> that's right. >> joining us to discuss the path forward for real estate is the cofounder and ceo of compass, robert reffkin. thanks for being on with us today. >> thank you for inviting me >> so we just heard what robert frank was reporting in terms of some of these high-end properties in the suburbs. but in general, we have now got

all 50 states in some sort of reopening and then just today, mortgage application data that's pointing to a recovery in home buying, as well. what are you seeing at compass >> so at compass, our year-to-date revenue is actually 47% over the same period in the prior year and last week, our agents put 40% more listings into contracts. so agree to sell in the same period in the prior year what we're seeing is an acceleration of a shift from traditional companies to tech-enabled companies retail stores to amazon, gyms to peloton, traditional brokerage firms to compass and we've been building for seven years, a technology platform with hundreds of millions of dollars in r&d, to help them grow their business and better-serve their clients being built by the cto of ai and microsoft who came on last year as well as greg hart, who is the sixth most tenured executive at amazon, creating alexa and launching amazon prime video, overseeing it there.

>> so, when i hear you put numbers like that out there, how much of this is compass-specific, given the fact that you do have this platform, you do have this technology and these capabilities and how much of it is a bigger sign or signal that we have seen a bottoming, at least where the housing market is concerned in major metro areas. >> so we're in 135 markets and across all of our markets, we saw a bottom two to three weeks ago. we have seen in-contract listing activity go back to pre-covid levels in over 90% of our markets. buyers right now are saying to themselves, i've been locked into my space for three months and they're evaluating, do they have enough space inside, outside, the right light, the right home office? and if the answer to those questions are no, they call their agent. and on top of that, you have record low interest rates and you have a viewpoint that you're going to get a good price right now. you're not going to get a better price in two years >> robert, are you seeing a

shift in demand out of urban areas and if so, do you think it will stick >> yes, we're seeing a shift from highly densely populated areas to less-dense areas. on our site, we saw an increase in searches for single-family homes up 40%, while condo co-ops are actually down. searches for homes that have a pool were up three times searches for homes with outdoor space, up two times. and the minimum square footage in a search was 10% higher than pre-covid levels i think this is going to be a continuous shift until there's a vaccine. >> well, to that point, robert, i mean, we keep hearing, especially from the white house, that the promise of a vaccine gets stronger by the day when do you think we start or we will start talking about value in urban areas, whether that's downtown austin or san francisco or metro d.c. or brooklyn, areas

where people were locked out because of pricing for a long time >> so, we have seen a drop in prices of a few points, on average, around 5% the high end has dropped more. that said, we asked if prices generally increase in a recession, and it's a nice hedge against inflation. and there's more actual buyer activity on our site, as defined by engagement with our agents around homes that they're looking than there actually are new listings coming on our site, as defined by new listing inventory in the market. so the supply and demand is still pretty tight with low inventory. >> robert, do you expect this shift toward more space, home office, pool, will stick, regardless of a vaccine? because i imagine a lot of home buying is emotional. people aren't going to forget this period anytime soon, and if they wished they had more space now, that's going to be burned into their psyche, right

>> i absolutely agree with that. buyers have never been so intimately aware of the inadequacies of their home after 9/11, the market froze in new york for three months, but when it bounced back, it was busier than it ever had been that catastrophe created movement and i believe the same thing is going to happen here this catastrophe has locked people in their homes for three months and is creating incentives in emotional reasons to move. >> so, robert, we're talking about increased activity in home buying right now how is the actual process of listing and selling a home changing, given the fact that we do still have, to a certain extent in certain markets, a lot of shelter in place mandates still underway >> so, sellers are now asking, how can you sell my home virtually? how can you market my home virtually? how can you get buyers into my home virtually at compass, we launched the

virtual agent search suite of tools. we have virtual showings, live tours, virtual open houses to meet those needs and that's one of the reasons why our aims have gained market share in this downturn >> and i know you touched thon this briefly before, but what is your outlook for home prices what are the markets that are poised to be the strongest in the coming months, in the coming year, and how much are mortgage rates factoring into that? >> so the markets that i believe will increase in prices over the course of this year are markets that are safe havens to the highly, densely populated areas in the cities. that would be the hamptons, markets in new jersey and connecticut. in san francisco, that could be sonoma, napa, marin. and i also believe that the markets where there's a strong technology presence, say, seattle, austin, boulder, san francisco, that those jobs have,

for the most part, stayed in tact and even in seattle, you've seen net job growth with companies like amazon there. and that will be -- that will help keep prices strong. >> robert reffkin, ceo of compass, thanks for joining us today. >> thank you for inviting us >> all right, well, just taking a look at the markets right now, major averages are higher. we have erased losses of yesterday. we're talking about tech in housing right there, but also the internet etf, fdn, hitting another all-time high today. up more than 51% from its march low, really speaking to what is continuing to fool this market right now, john. >> yeah, morgan. and got to mention facebook again. it has cleared $230 a share, all-time highs this morning on that announcement of facebook shops. also want to mention spotify it's at 52-week highs after announcing an acquisition in effect of joe roggin's podcast for a rumored $100 million or

so that's a big draw. carl >> that's abig story and then amazon, guys, we've been talking about 2,500 for so long and that's about $15 away. amazon, one of those that have set record highs today, along with facebook, as john said and chipotle so a busy wednesday morning. let's get to the judge and the half >> carl, thanks very much. our breaking news coverage of the markets continues right now. welcome to the "halftime report." i'm scott wapner good to have you with us our top story this hour, the run towards new highs and the man who says we will get there this year tom lee, making that call today. he is here to defend and debate it with our investment committee. joining me this hour, joe terranova, jim lebenthal, jon najari najarian, carrie firestone is the ceo of asset management. let's take you to the wall and show you where stocks are currently trading. highs of the day, 24,618 is where the dow currently sits, a gain obeer