good wednesday morning i'm carl quintanilla with sara eisen live on the floor of the new york stock exchange. on the agenda today, hilton ceo christopher nassetta is with us. big earnings beat and they hiked their full-year guidance why that stock is signaling continued strong travel demand >> cme grew terry duffy also with us. another earnings beat there on the top and bottom lines, plus his take on a broken nickel market among other things. >> later on, vincent reinhart is with us. his warning on persistent inflation as these five-year credit default swaps hit a new

decade high, as we are now on watch for a vote in the house regarding this debt bill >> whether he does the vote or not, whether he has the votes or not, that certainly is front and center julian emanuel saying that he thinks it's part of the sell-off we've seen in stocks lately. and as far as that goes, the s&p 500 has been up higher this morning and has been lower this morning. it's unchanged the nasdaq stays stronger, thanks in part to microsoft and a rally in big cap tech, nvidia, amd, they're surging today amazon is up on the back of strong cloud results from microsoft. it reports tomorrow. meta reports after the bell. but reversing at least part of the sell-off we saw yesterday, which was pretty brutal. >> yeah, meanwhile, the headlines that amazon made, doing some layoffs in the cloud division beginning today we'll see if that becomes a material part of their call, as you say, in 24 hours >> it's cost cutting, ai informs i investing and what's happening on revenue the earnings showing us an extreme version of the very split that we've been seeing in the markets in the past few

weeks. the markets where banks are taking their pull on some of the cyclical names and small caps, where large caps continue to dominate cnbc's senior markets commentator, mike santoli joins us with a look at that theme, mike what are you watching? >> this is not a market that's really in gear right now very uneven performance. and it mostly dates back to the collapse of svb back in march. if you take a look at the s&p 500 against the russell 2000, that's really when the performance split there started to really take hold. the russell 2000 often trading in line with financial stress, financial conditions, bank stocks that was right about there, that svb occurred now, the s&p 500 itself, yeah, the calm was broken yesterday. we had this very gentle sideways action we got more than a 1% drop still, the peak-to-trough so far this year, 2 to 3% off the highs. no big deal. we're right near a support level for the s&p 500, but it really does mask what's happening

underneath here's tech versus banks within the s&p 500. even a more stark divergence from guess when, right there that's the beginning of march. that's when we started to have trouble with svb now, to me, this is an issue for the market longer term you can't have it be very narrow for very long and make upside progress on the other hand, it is an answer to those folks who say, why is the market holding up so well the economy looks like it's slowing, it seems as if there's maybe more recession risk we have to take account of. to me, the market is already recognizing those things and kind of trying to point these out for a while. it's not as if the market has baked in great growth expectations and that's why perhaps some of the more comforting earnings report and guidance is helping some of those individual stocks that seem as if they can kind of keep profitability in line, at least with diminished expectations >> and we've been taking note this morning, again, of the number of companies that either raise their guide or affirm in it it's the gamut, humana, hilton, otis, dover, and so forth.

where does that leave someone like a morgan stanley's mike wilson, who's counting, who is saying, there will be a reckoning on earnings, and not too long from now? >> it's completely in play in other words, i don't think this essentially refutes the idea that we could have a second-half decline. i don't think any of those companies are operating on the assumption that we do get a severe retrenchment in the broad economy. but the second half earnings estimates are the battleground at the moment. if they can hold up, if 2024 starts to look anything but delusional in terms of the consensus when we get into the second half of the year, then maybe it's really not going to be that bad. so far, it's an orderly decline in earnings. it's a flattening out of profitability. yes, we're seeing year over year drops, but it's not something that necessarily has been in excess of what the market has already tried to recognize >> that's well put, mike and we'll see what the coming quarters tell us we'll see in a little bit.

mike santoli meantime, moments ago, activision releasing its earnings early, as you know. the uk blocking that deal with microsoft. steve kovach's watching it steve? >> this is a surprise. they were supposed to release the earnings tomorrow after the bell, but i'm told by a spokesperson activision released it now, after the cme decision rejecting the deal, which is likely going to kill the deal overall. let me run over the numbers real quick, it is a beat on the top and bottom lines as you can see, not doing much to alleviate the stock here. it's on epps, it's 60 cents adjusted coming in versus the 52 cents estimated by the street. revenue is also a beat at $1.86 billion versus $1.79 billion estimated. and then just some really strong commentary here against the decision, activision release calling the cme decision disproportionately, irrational, and inconsistent with the evidence also saying they're going to back microsoft as they go through the appeals process with

the cma, but that is likely not to play out in microsoft's favor and activision is looking more and more likely, like it's going to be an independent company come this summer, carl >> you had a great analysis in the wake of the news this morning, steve, on squawk. just trying to walk viewers, why the uk regulators would be so, i guess, microsoft would argue, belligerent, for a market that is still just in its nascent stages >> that's the interesting thing about this, carl the cma several weeks ago dropped a huge part of their case against the deal saying, we're going to ignore the fact that these are a video game console issue. we're going to talk about the future, about cloud gaming which is this idea that microsoft has, where you stream games instead of download them now the cma said, even though it's early days in this cloud gaming market, microsoft has a huge advantage they claim they have 70% of the market already not to mention the infrastructure on the cloud side to make these kind of services possible, so they're saying, because of those reasons and the

future potential of these kind of cloud gaming services, they don't want this deal to go through. it's a little bit interesting to see them back away in a significant way. most people were expecting this decision to say, look, we're going to -- the cma say, look, we're going to approve it, but with some conditions that microsoft would have probably happily accepted, carl >> steve kovach with the latest on the pre-announcement. let's turn back to the big tech earnings strong reports from both alphabet and microsoft those stocks moving higher this morning. can the momentum keep up, when we hear from meta after the bell, amazon tomorrow. our next guest expects tech earnings to surprise to the upside, thanks to cost cuts and a weakened dollar. joining us now is emg capital founder and president, eric jackson. so eric, what were the readthroughs for you, from what we've gotten so far? >> well, i think mike was talking about how tech has performed versus the rest of the market you can really a draw a distinction, though, especially coming out of the reports last night about how big tech is performing versus the rest of

tech, even there's stark differences. remember, we got out of the start of the year, the first five weeks of the year, where profitless tech was sort of leading the way. shot out of a cannon a lot of those names have given back all of those gains and more and now big tech, the biggest names, like microsoft, amazon, alphabet, apple, and meta, combined are up 34% year-to-date versus the nasdaq, which is just under 14%. so, the reports last night showed that there's a good reason for that. it's not just a flight to safety, although that's part of it you know, just operationally, they're doing really well and there were some glimpses last night into earnings and revenue acceleration going into the second half of this year, rather than sort of a mike wilson, everything's going to come apart at the seams narrative >> eric, i think of you as more of an everything else in tech kind of investor, not usually big tech your calls are usually the ones,

i don't know, 23 and me, upwork, you've had zillow over the years. the sort of more volatile, less safe haven type big tech that we're talking about, that's really working right now >> yeah, tech was the sort of start of a wider tech in general rally because of the drop in inflation, that could last for the majority of the year the russell is now negative on the year so a lot of the small-to-midcap names chwhich i do like, sarah, have really fallen back. it really did accelerate with the silicon valley bank debacle. and that sort of has led to a lot of rotation with those names. there's good news to be found in the big cap names and more to come with meta and amazon later this week, and i think there'll be a broadening out of this rally. that is going to seem some resilience in some of these

smaller tech names but to date, it's been big tech all the way this year. >> eric, i wonder, you know, there's a lot of discussion right now looking at implied earnings volatility. and you can see almost the latter in terms of megacap tech names, how the market sees their ai leverage, right names like meta are way above others like amazon and apple and i wonder if you think that there's some, whether those converge at some point, understand everybody is in the pool >> yeah, but you're right, carl. that these -- the behemoths here in big tech, you know, they have a significant scale advantage. and so they are going to realize the efficiencies from those investments in ai first, and perhaps for several quarters to come, before we see that trickle down into some of the smaller names. it's not just -- ai is definitely not a, you know, how much share is google losing to, you know, chatgpt.

it's really showing up in the earnings last night in terms of things like co-pilot, which is a piece of get hub within microsoft, sort of the dominant way of coding software data, and they got a callout for copilot, which is a way of helping programmers basically code faster, by guessing, you know, what they would need next in terms of their efficiencies. you would think of that as a small little point feature release within what was a $1 billion acquisition, and not really moving the needle for a behemoth like microsoft. and yet, it's getting that attention. because it's a dynamic product so they're going to roll that out into 365, they said, last night. and so, it just shows you how these larger companies are moving faster, moving first with their investments in ai and sort of seeing the efficiencies i think later with meta, you know, it will be interesting to watch what they guide for the rest of the year with something

like reelz and whether their ai investments are going to project much greater efficiencies than what the market is expecting there. >> eric, appreciate your topline views on what we're getting from tech thanks for joining us. we'll talk to you soon eric jackson coming up after the break, cme group out with some record results as these trading volumes surge. ceo terry duffy is with us to break down that quarter and give us some insights into how traders might be positioning right now. we're watching dow component boeing, second best performer after microsoft. an earning miss, but the stock is up on some of these production guidance regarding the 737 max. revenue up 28% over e thquarter. "squawk on the street" continues after a short break. here. aspercreme arthritis. full prescription-strength? reduces inflammation? thank the gods. don't thank them too soon. kick pain in the aspercreme.

welcome back the exchange benefiting from this recent volatility seeing a flight, it's not enough to keep the stock in the green today. joining us this morning, cme group ceo terry duffy is us. it's great to have you back. fascinating quarter. you had some single-day records. is this about options or is it broader than that? >> well, options, carl, was no question a bigger mover for cme group this quarter we had a tremendous amount of activity in our options market across all of our multiple asset classes. so we are very fortunate to have all of these different asset classes that people need to manage their risk for and again,

all up across the board. so we were very pleased with the results and have a record, you know, eps quarter is truly remarkable we took this company public back in 2002, and i think the growth trajectory has been amazing over the last 20-plus years >> yeah, as you look toward the back half of the year now, are you imagining that things get less or more volatile than this? >> it's really hard to redict. one of the things i said on my call this morning to investors was, i think there's a very big deal, and i know you guys are starting to talk a little bit about it, which is the debt ceiling and what's going to happen and, you know, i look at, you know, you can only look at what's available to you. when you look at 15 rounds of trying to elect a speaker from its own party, what does it mean when it comes to a debt ceiling negotiation to what are people going to want in order to get the votes for a debt ceiling i think it's a little bit different, even going back to when speaker boehner and president obama were negotiating at the very last hour before the

debt ceiling elapsed in 2011 i think it's going to be a pretty fascinating summer to see how this pans out and how the markets are reacting to it and how they'll manage the risk associated to that >> what would a technical default look like in the treasury market, in your markets, terry >> yeah, i don't even want to go there. i think we're looking at parks and other things to start with, ify going to start closing down parts of the government, like we've seen historically. i think a default on the largest market in the world would be, you know, something really -- i don't see that happening so, but we are prepared in order to manage the risk for participants, as it goes forward. so again, i think this is very fluid, but we are paying very close attention to it, sarah what it would look like ultimately i think is anyone's guess. >> so on carl's point about where volatility goes, people have been remarking at how quiet it has been, just in the very near-term, low volatility.

and i'm curious what you think these levels coming off the very high levelses signal about the outlook for the market and the economy? >> well, sarah, that's a great question you're coming off of record vol over the last 12 to 24 months. to have a short-term lull over a quarter for volatility is not surprising it doesn't surprise me a bit i've been in this business for a long, long time. and to have the sustainability volatility we've seen over the last couple of years continue without some kind of a breather to catch your breath and to see what it means going forward, you know, would be highly unusual. so this doesn't surprise me one bit, sarah so i think it's a little bit of a quiet before the storm, as i said earlier with the debt ceiling issue coming up. we still have multiple other issues, sarah. we have the ukraine issue we have to deal with, the taiwan issue with china we've got to look at. a whole host of factors out there that people aren't talking about right now that could raise their head any moment. and volatility could get, you know, raise itself up very quickly. >> finally, terry, to crypto

evidence from some sharply-worded statements lately, about the resolve of regulators to kill the industry in the words of some critics how is that playing out in terms of volume there? >> well, you know, carl, that's really interesting question, because i was actually looking at our crypto volume just this morning, just in case it came up on the call. and what i found interesting is our large crypto futures contract is actually up, where our smaller microcrypto contract is down in volume. so the smaller one is more of a retail trade contract. so i don't know if that's a proxy for other markets that are more retail-driven today, whether it's a cash equity options that are more retail driven right now and the institutions are more participating in these products, but i think it's pretty fascinating about the crypto i don't think it's going away, carl i think you'll see a bitcoin ether contract continue on and one of the things i've said, we're going to looking at approving out its use case

and i've met with clients in london this past week, and i think there's a tremendous amount of optimism as it relates to some of these products. >> last time you were on, terry, you were pretty scathing around svb and how they mismanaged basically interest rate risk, right? you said, we have products for that so i'm curious if the regional banks who don't hedge their interest rate risk and a lot of them do have this problem, if they're starting to do that? >> so we have a big outreach, sarah, to the regionals. and one of the ways the regionals need to be in compliance, one of the things they do do, they do swaps insider to manage some of the risk we're working with them to continue on with the swaps markets that we have here. one of the benefits that cme derives from that, normally a bigger bank, whoever they'll do it with, the layoff comes, so we benefit from that. so we are continuing to help promote those products in units that go right to the banks

we know we're going to benefit by the layoff. so yes, i think they'll continue to start to manage their risk more properly in realtime. >> do you think they'll be regulated to do so do you see the regulations changing for them on this front? >> i think that i wouldn't rule that out, sarah. i just don't have any information to say that they would. but i know that there's some people, i think you guys were reporting on earlier, with first republic and others. i don't know the ultimate answer to that, but anytime you have a legal fiduciary obligation when you're holding other people's money, i think there should be a lot of restrictions around what you can and cannot do. and making sure you manage that risk properly on behalf of the people's money you're holding is critically important to all. i don't know if that's going to happen, but i wouldn't be a bit surprised if there are some new regulars associated with it. >> terry, it's a really good look at the market we're still struggling to understand on some days. thanks so much good to see you. >> yeah. thanks, carl

thanks, sara, appreciate it. >> thanks, terry later this hour, another earnings exclusive, ceo of hilton joins us. his take on the state of the consumer ahead of a busy travel summer season following a blowout quarter. and jeffries downgrades tesla to hold concerned about margin pressures as the company keeps cutting prices that stock hitting the lowest level since january, it's down 3% right now we'll be right back. ♪

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a couple hours into trading, close to session highs here. back to 4085 let's get to bob pisani. bob? >> here on the floor, in fact, we're standing right next to first republic bank. and here's clint carell, an old friend of mine an important thing about this, i want to show you the trading

volume this is limit up, limit down volatility halts take a look at the volume, though 110 million shares to give you an idea, typical of these regional banks used to be 3 to 4 million shares a day. yesterday, it did 193 million shares from 3 to 4 million, to 100, routinely now doing 100 million shares in the last few days, as it's been moving to the downside ten heaviest volume days i want to show you the more regional banks here. here's comerica. the at least stable today. remember, this was 165 or so, before all the banking crisis went -- dropped down here. but it was 47, it rallied as it was going down and now it's back down to 41 this is part of the problem. they're having trouble stabilizing, most of them are trading at the low end of the trading range that they established in the late part of march. one of the more stable banks,

oddly, an new york community bancorp. most people didn't even know new york bancorp, but they bought a good part of the assets of silicon valley valley bank and interestingly, they have been relatively stable in the last couple of weeks so halts on more than 100 million shares, a good indication of how unsettled the situation is around the bank right now. guys, back to you. >> bob, we'll keep an eye on that with your help. let's get a news update in the meantime with sill vana henao >> house republican leaders emerging from a conference expressing confidence that the debt ceiling vote may come today according to house majority leader, steve scalise. >> we can vote as early as this today. we'll be bringing the rule vote, which allows us to bring the bill up.

and addresses the changes that were made. we'll be ready to move as early as today >> alexei navalny appeared in a moscow court via video link today. he could face 30 more years in prison after investigators opened a, quote, absurd terrorism case against him this marked navalny's first public appearance since his spokeswoman said that he was suffering from stomach pain in jail that could be some sort of slow-acting poison governor ron desantis' oversight board is set to meet today and consider a proposal to nullify the agreements struck by disney in february the move to retain the company's control over the land it occupancy and this comes after a florida board, which oversees special tax districts criticized disney's february move last week sarah, i'll send it back to you. >> thank you, silsilvana up next, vincente reinhart on why he thinks the fed is

unlikely to signal that rate hikes are coming to an end and check out chipotle, top of the market. all-time high for this stock another consumer discretionary name flexing its pricing power ceo brian nichols speaking about those results last night on closing bell overtime. >> we use it very sparingly. you know, we don't like to take price unless we absolutely need to we had to take that based on some of the inflationary environment we're dealing with and fortunately, in our q1 results, would be great traffic results, we had great operational performance. and then we also opened a lot of new restaurants. all things actually delivered for us in the first quarter.

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welcome back recession indicators, as you may know by now are rising five-year credit default swaps above their 2011 highs now up more than 10% for the year and the fed's preferred recession indicator, the ten-year three-month yield curve, most extreme reading since the early '80s however, as apollo's chief economist points out today, most of the indicators that points to whether we're in a recession say we're not quite there yet. regardless, the fed is expected to continue raising rates next week our next guest says that given inflation, they may not send the signal that they're done joining us this morning, drives and mellen chief economist and macro strategist reinhart is with us here at post nine. great to have you.

thanks for the time. >> thanks for having me. >> what do you think the meeting sounds like? >> they're in a really tough spot they want to be balanced as to the next policy action, because there's no presumption that again. however, the precedent is, if they signal that they're balanced, market participants will read it adds, they're done, and that's just a way stop to cutting rates. and the problem is, financial conditions aren't really that tight relative to how much the funds rate has risen >> that's taking everything into account, or just the rate itself >> both in prices and quantity terms. we're getting a little more -- they're getting more traction on quantities, just because last month we had a bank run. but in terms of risk appetites, markets are pretty receptive and so, this is a tightening in the fed funds rate that isn't so

much in financial conditions generally. >> well, that's because the market is excited about the fed coming >> exactly >> it's a vicious cycle. >> right >> they're done after may, aren't they? or no? >> that's why you don't want to be jay powell next wednesday, right? even if you thought you were done, you wouldn't want to send that message, because people would just run with it and say, when are day going to start cutting and by how much lower will the fund rates be by the end of the year? and i don't think -- and central banks never say never to give with i'm not so sure they are done. if the basic arithmetic powell worries about doesn't change, that is the economy's got moment, resources are taught, and we see inertia in core services, exhousing. they may have to raise rates

again. their problem is, they really can't raise rates after they've stopped. >> why >> the hurdle is just very hard. they can do anything, right, but it's -- but once you have got a meeting without action, the barrier to action. >> bank of canada -- >> can we take some lessons to what the other guys are doing around the world >> you could if you freed up your statement and were varying it and were seen as a little more reactive. guess what, that's not the federal reserve. the bank of canada can do it, because that's the tradition fmoc is in a position in which the communique could just as well be chiseled in stone. it doesn't change all that much. >> so on the other hand, you say, there's still some momentum in the economy and in inflation,

we're still dealing with a bank crisis look at first republic and there was a market reaction yesterday. even if you think that they're unique, which it appears to be so, there still is this lingering stress you see this in how much banks are borrowing, still from the fed. we saw the m2 data yesterday, that shows liquidity is coming out of the market. it's what the fed wanted to see, but some forward-looking indicators that haven't filtered through into the economy yes are showing that we're headed for a downward trajectory. aren't they? >> three parts to to that. the fed wants spending headed in a downward trajectory, because that's what it takes to take off pressure on resources and make progress on inflation. number two, if you want a slow aggregate demand, you've got to tighten financial conditions you've got to crimp credit that means shrinking balance sheets traditionally, the monetary transmission mechanism works through banks. it's going to be shrinking

so that part can't be a surprise and the third part is, the economy is not exactly linear and predictable, once you start slowing, there's a real risk of stall speed. and so, you've go to accept the evaluated probability of recession if your goal is to slow spending a bit. >> finally, on employment. are you looking for negative prints this summer or in the back half? i've seen some calls for 50k in may, for example >> so we always used to say that employment goes up by the escalator and down by the elevator in expansion, you get the 200k vigorous, but it's pretty predictable. on the way down, that's when you get the big really scary, negative prints. if you think the economy is

going into a recession, which i kind of think by the end of this year, then you should be prepared for negative print. you should be prepared for, you know, a couple of pence on the unemployment rate. you should be -- there'll be bad friday mornings. >> so when does the fed cut? >> the fed cutts either -- well, you've got three choices, one is market's right and inflation just follows immaculately. and it's so nice, you can just follow it down the fed cuts because they give up just, inflation is so hard to work down. they say, hey, 3.5, sounds like 2 to me, and we'll have opportunities at a later date to disinflate or the fed sees the economy just spiraling inward and has to cut. when you think about those dynamics, number one, it's got

to be number one that the market is priced in you wouldn't have risk assets where they are now if you think people would give up or the economy was going in recession number two, if the recession story, it takes a while to materialize. and it depends on what's happening with inflation along the way. >> it sounds like you're thinking '24 at the earliest >> i believe jay powell when he says, we'll put rates at a restrictive plateau and keep them there nobody is foreseeing a rate cut in 2023. that is nobody who actually raidses their hands at the fmoc table. lots of investors are, but they're going to be proven wrong. >> great having you. >> i love the deep psychology of fed thinking, gaming it out. big tech earnings continue this afternoon. meta is set to report. we'll tell you what to look for in tonight's earnings with the stock up 77% so far this year. "squawk on the street" returns this morning

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welcome back time for today's "tech check." meta, the next tech giant to report earnings following alphabet and microsoft last night is coming up in a few hours. julia boorstin is looking ahead to it. hey, julia >> well, mark zuckerberg declared this the year of efficiency now the question is whether a slimmed down meta can accelerate its earnings growth. earnings per share is expected to fall by 25.5% in the first quarter, compared to the year

ago quarter, while revenue is expected to decline by nearly 1% and will be al of focus on that topline number, whether or not they can get it into the green investors will also be watching for a couple of other key things first, commentary about the ad market weakness. second, meta's progress making money from reelz and also messenger. and third, this question of how much meta is investing in both ai and the meta versus and when those different types of investments will begin to kpay off. one key headwind is the winter and so far we see no signs of recovery on that front, saying we think meta's scale should make it a somewhat resilient platform year-to-date, the stock is up about 76% as meta has outperformed both its peers and the broader market, and despite those gains, analysts are still very bullish on this stock, 71%

of analysts have a buy rating and 20% have a hold. carl >> i keep thinking, there's been a lot of bull cases tossed around in the last couple of days ad volume per dau has accelerated in the past six quarters that's on top of all of the operating expense potential downside on spending i'm just wondering if you're hearing a lot of bear cases going into this? >> there are so many concerns about the brofader ad market and that could be the bear case. that's something you've heard since we got those results from youtube just yesterday, part of alphabet but the broader question is sort of, if there is an ad contraction that is persistent, that does continue through the rest of this year, at least through this summer, what are the companies that are going to be best positioned to navigate it the companies that can quickly turn off advertising tend to be those that suffer most when there's the beginning of a downturn and you can quickly hit pause on those ads.

at the same time, if there's an opportunity to quickly ramp up, meta might be seeing some of the benefits of that and if they're really delivering on targeting and measurement, that should enable them to be more competitive that's a key thing here. how well positioned they are, amid this ad contraction >> all right, julia, thank you >> julia boorstin on meta. up next, hilton hiking its full-year guidance on the back of full travel demand. the company not seeing a consumer slowdown. the ceo joins us next. and getting crushed on weaker q2 outlooks the company's ceo llteing pippa stevens growth in the u.s. is at a standstill the u.s. accounts for 65% of the company's total revenue. we're back in just two minutes

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people are out traveling at all costs. that's the main takeaway from hilton's q1 earnings, raising its outlook for the year, expecting another busy summer. joining us now in a cnbc exclusive is hilton's ceo. welcome, chris good to see you. >> hey, sara, thanks for having me >> you're welcome. >> can you just expand a little bit on the demand you see from here on out? >> yeah. listen, right now, what we're seeing is strength across all of our important segments leisure, travel in the quarter continue to be very, very

strong both from a volume and a pricing point of view. business travel made its way back, finally, from a volume point of view to above peak levels of 2019, and pricing is quite strong and then meetings and events, which is sicirca, 16 to 18% of h overall business, but an important part of the business, the pricing structures are good. it's not fully back to 19 levels, but building very, very quickly. that's a longer leadtime business, that we expect later in the year we'll get back to 2019 levels of overall demand. so, you know, broadly, you know, very strong results across all segments >> business travel, which you mentioned. i'm curious what you're seeing there, more granularly in the tech and finance industries. which we've seen pullbacks on cost have you seen a plateau at all if demand from, i would think, a pretty critical sectors on business travel? >> and if you break business

travel down, it was back over '19 levels, but the makeup of it is different the majority of it, 85% of our business travel is now small and medium-sized enterprises that's up from about 80 in 2019. the big corporates have been, you know, have not technology, g and consulting, they've been under 2019 levels and have plateaued a bit because of those three segments if you take those three segments out of business travel, you're continuing to see big corporate travel actually increase we were with a bunch of our biggest customers a couple weeks ago in new york listening to them and what their travel needs are, and they were broadly, again, with the exception of those segments, they were broadly signaling higher demand for business travel, so, you know, that feels pretty good, and we've been very purposefully shifting our mix to smes it's a higher rated business

it's more resilient. and, as i said, it was already 80% of the business pre-covid. now it makes up a larger percentage of it i suspect it will be that way for an extended period of time because we're going to choose to do that. >> what about tourism, chris, and international tourism specifically inbound to the u.s., outbound to the u.s. markets like china, now that it's reopened to the u.s., such slow rates >> it is sluggish. it's back to about half the levels of 2019 if you lift way up and say in an environment that is clearly slowing and uncertain why do we keep posting better and better results, i think there's sort of three things going on. one, there's a lot of pent-up demand, particularly for business travel and meetings and events that's creating a big tail wind for us two, there is a secular shift in how people are spending. so they may be spending somewhat

less money than the last couple of years, but they're spending it more on experience, travel, the types of things that require hotel rooms than they were before and that's sort of a secular shift that has picked up steam and had been happening precovid. the last thing to your comment is international travel. the reality is we're probably only back to half the levels of inbound international as compared to 2019 part of that has been the world hadn't been open, particularly china. china is now opening, but it will take some time to build that business back, to get flights in and out as well as into other markets the other thing there is a significant -- i also -- my night job i'm the chair of u.s. travel association and the wait times associated with getting visas from countries that require visas is into the hundreds and hundreds of days. >> wow >> and so it's very difficult

for many of these travelers who do want to come here to get here and so we've been working with the administration and the state department to try and reduce those wait times but i think there's a tremendous amount of upside potential in international travel over the next 6 to 24 months. >> chris, we spend a lot of time talking about the structure of the workweek in america these days because of remote work and especially in manhattan we talk about weakness and softness on mondays and fridays. is that material to you? is the sunday night stay important? >> it's interesting. i'm laughing because we all talk about it we talk about it here. i walk down to our studio and i notice the building is full of people, so that's good we're pretty much back to a normal environment here. but the new normal, i should say, new normal is mondays, particularly fridays, you know, are probably lower occupancy tuesday, wednesday, thursday

higher that's what's going on around the world. i think it is normalizing, but i do think there's going to be percentage wise more remote work generally and certainly more flexible work environments and i think that is here to stay why it's good for us, carl, to pick up on your point, it means people are more mobile and so mobility, if you look at time and eternity in our business what's helped the lodging business has been people being able to be more mobile some of that was transportation, low-cost air carriers, rail, you know, the ability to be able to go out and get around the world, get around when they're in destinations around the world. some of it is having more flexibility with their time and having a device in their hand that allows them to work from anywhere essentially and so the increases in mobility were already occurring i think covid accelerated those. and i think net-net it's a terrific long-term trend for our

business people need more places to sleep and they need more places to meet, and we provide those things very well >> chris, we need more time. next time we need to talk about spark, the brand you launched. >> i'm dying to do that. why don't we do a segment at the first opening of park? >> that's great. when is that happening >> that's an agreement that will happen probably august/september >> that was one of the analyst questions. we killed two birds there. hopefully you'll be back before then apprectehe tia time today. >> thanks. ll find pnc bank. helping businesses both large and small, communities and the people who live and work there grow and thrive. we're proud to call these places home too. they're where we put down roots, and where together, we work to help move everyone's financial goals forward. pnc bank.

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a clear violation of constitutional rights for the state to retaliate against it because it expressed an opinion. of course this is all about that don't say gay bill and disney is now seeking relief from the court to carry out its business plans before this all started. we have reached out to desantis' office for comment and have not heard back yet >> julia, i was just looking at what iger told "time" magazine a couple weeks ago on this quote, i do not view this as a going to the mattress situation for us if the governor of florida wants to meet with me to discuss all of this, of course i'd be glad to do that would you consider this a reversal of that >> reporter: well, look, this thing has accelerated in terms of what the state of florida has done since those comments made several weeks ago. as the state of florida has tried to unwind this special tax district disney has had for decades. what's so essential about the tax district it enables disto

have plans of logistic things. bob iger and disney has made it very clear they're hiring tons of people, investing, and they need that jurisdiction >> yes well, i don't know, republican voters, i guess, will maybe have to choose between hating woke companies or disney. a lot of people like disney. >> thanks, julia let's get to melissa lee and "the half. welcome to "the halftime report." i'm melissa lee in for scott wapner front and center tech earnings, deal drama and what it means for stocks with one week to go until the next fed decision. joining us to break it down, josh brown, kari firestone, joe terranova and jenny harrington our chart of the day, a bullish outlook on ai a major blow to the deal to buy