visit coventrydirect.com. good friday morning. i'm carl quintanilla along with melissa lee. >> the ceo of novartis is wells intl positive data on the breast cancer drug giving the stock a bump today. later on, the week that was in retail. we have lulu with blowout numbers, macy's warns, dollar general cuts we will talk to walmart chief bill simon on the back of their

annual shareholder meeting. >> we are looking at footing session highs right now, dow is up by 1.6% s&p gaining. nasdaq composite is the star here, up by 1% nasdaq 100 hitting a 52-week high that's where all the gains are being made big tech >> debt ceiling about to be signed, decent jobs number, fed may be on hold i know you're watching what tech is doing today relative to small caps. >> that goes to divergence between big cap and small cap. the nasdaq 100 versus the russell 2000 nasdaq 100 is hitting a record high against the russell 2000. that's why a lot of strategists are saying play for the mean reversion, go to the equal weight s&p as opposed to the s&p 500 to get the underperformers. >> or sell ai, buy the hang seng

finally, a vix this morning as well, below 15 it does turn some heads today. would be the lowest close since february of 2020 kind of interesting debate about whether that's good or bad and whether you buy stocks with a vix that low >> and remember it's friday, vix gets sucked out ahead of the weekend. there's a little bit of that going on 14.8 that's really remarkable. >> topping the tape, tech continues to lift up the market. b of a does see record weekly inflows, $8.5 billion entering for the week says the market is bored waiting for rates to cause a recession and investors refusing to fade 4200, clearly, with the biggest companies with the biggest margins getting favored. let's bring in mike santoli, cnbc senior markets commentator. you must think today is pretty interesting. >> i do think it's interesting

for good reason. it's been uneven, it's been top heavy. the thing about it is people very early to call, this is overdone it's only been three months, really, that we've had this handful of stocks dominate only since svb this has gone on for a year, year and a half. today you see rerotation toward the laggards retail is bouncing, energy is bouncing we'll see how much room there is for something like that. you have an interesting moment, what does it mean not to fight the fed and not to fight the tape the tape is cooperating. you mention the volatility index. it's merely reflexing how the index has behaved and the divergences within the index bull market, it's rare to have it below 15 and it means it's bottoming. we're in kind of this mixed zone, waiting for hard or soft landing, waiting for the market to broaden out or buckle for one

last flush lower. >> you would think there would be much more positioning in the cyclicals, they would see much more upside. you can argue tech will still see upside but the bigger gains will be made in the underperforming cyclicals. >> i agree the thing is people are going to be hesitant to really go all in on that idea no matter what you're talking about, you're still at 3-point-something unemployment so, you have that kind of constant reticence believing this can last. this is 2019 is the fed going to cut with the market at an -- they did because it felt late cycle i think you can look back to these prior periods and have some kind of clues i think being dogmatic about how the market has to act when the old curve inverts and recession has to come on time. maybe it will come but it's not satisfying the people who got

too negative on the economy in a hurry. >> we had goldman on the last hour who's already below cons consensus, 35% recession odds and says that risk goes lower, not higher. >> again, you're never going to escape the fact there's a cycle. and accidents can happen and really, you know, accelerate the process of getting toward that but i do -- look, we're running out of year. the first half of the year is almost over. and, you know, how fast are you going to go from a 200-plus thousand job pace monthly to negative that's the question. >> mike, thanks. we'll talk in a bit. closing in on 4280 now mike mentions the jobs number did top expectations although the unemployment rate did move slightly higher. that leads to the question of the morning, what will the fed do at the meeting this month we've heard cases for skip, and the chances for no rate hike, now about 71%. but after today's data, our next

guest does recommend a hike at the next meeting joining us, former federal reserve board governor fred mishkin, professor at columbia great to have you with us. it does sound like you want to make sure inflation is dead. >> take a look at the numbers. the core inflation is still very stubbornly high, 4% level on the pce deflator the news has not been good there. it's a long way from the 2% inflation target so, it's true that headline inflation has come down but that doesn't tell you much about the underlying inflation rate, which is what the fed cares about. that's number one. number two is the economy is still very strong. you see it in terms of the jobs number, the stock market's strong and so forth. so, from my perspective, the fed really does need to keep raising rates. and it's not crazy to talk about pausing. because might want to see what's going on on the other hand, the fact the numbers have become so strong

and the latest jobs report indicates they're going to have to keep raising rates. very unlikely not unless something untoward happens or a big problem in the banking sector but i don't see that maybe the fed sees something but i think the fed has to show they're serious about getting inflation down a long way away from -- a long way away from where they want to be to me that means they need to hike but i can see a pause is a possibility. a strong possibility but i would go a little bit more hawkish. >> yesterday it was bullard talking about whether or not we're in modestly restrictive territory. do you not think we're there quite yet? >> i do think we are, no question in my mind that's the case remember, by the way, initially when the fed started raising rates, even when they were doing 75-basis-point increases, the fed was in accommodative territory at that time it's true it takes a while for monetary policy to take effect

but tightening didn't start to bite in until not too long ago my view on this is we're a long way away from where we have to be unless there's some bad things the fed is seeing that i don't see. they really should -- the cautious approach now is actually to keep raising rates and, in fact, most importantly, and i would like to see a rate rises, the talk of pivot has to go away. the fed, no matter what, has to keep rates high for a very long period of time in order to get inflation under control. if they did decide to pause, i think they have to be very communicative about the fact that if anything, a strong biased in raising rates further, and certainly there's no -- really off the table is any kind of pivot in the foreseeable future within, you know, reasonable period of time >> does that mean -- sorry to interrupt. does that mean if you say talk of pivot should be completely

off the table, that you have closed the door on the scenario where we see a hard landing, a deep recession the thinking is they will do that, they will start cutting when things get bad. >> but actually -- but they have to really be seriously bad unfortunately, when you let inflation get out of control, the only way you basically can get inflation under control is by hitting the economy and slowing it down. and i think that that's the key here we they said, you have to earn it that's what the fed needs to do. that's the unfortunate reality when you've made a mistake and you actually had much too easy monetary policy, which i was critical of the fed for a pretty long time before they started raising rates. if you get behind the curve, you're going to pay the price. if you don't pay the price, it will be worse. in fact, inflation won't go down, it could go up you may have to raise rates even

more that's the worse scenario. better to be pre-emptive, get it done, than waiting and have a real problem we've seen what that's been like in the past. not a good scenario. >> you mentioned the tightening that's already in progress thanks to higher rates and credit conditions, et cetera, but there's also the outstanding issues i mean, because of the debt ceiling bill that just passed, basically, the treasury is selling bills and bonds, we have the end of s.n.a.p. benefits, the end of the moratorium for student loans. how do you think about these things factoring into where we end up, quote, unquote, landing? >> one of the big uncertainties that could cause real negative problems for the economy was this debt ceiling issue. that's now resolved in a positive way that the u.s. is not going to default on debt that would have changed things that's the kind of bad scenario

thing you have to react to in fact, if anything, what we've seen in the last couple of days is some of the things that might have been negative have been taken away the debt ceiling is no longer an issue. you no longer have the problem of worrying that unemployment is going to -- that the employment report was going to be bad from my viewpoint, there's only been positive news in the past couple of days that's one of the reasons i think the fed is going to be -- the view that the fed was going to pause at this meeting before we've had these two recent events may be -- people may be overestimating given there's new information, which if anything is really positive i think that's going to affect the fed's deliberations when they go into the meeting. >> we'll see, rick it would definitely require some adjustment in pricing in the next few days, but we'll see what we get in june. have a great weekend thanks fred mishkin. still to come, we're live

from the walmart shareholder meeting in arkansas. they hope a digital transformation can help it weather a consumer slowdown. >> and we'll be joined by walmart ceo, bill simon. he points to one key sales pattern that has helped a few select cpaesutomni operform. more "squawk on the street" is after this ♪ ♪ the biggest ideas inspire new ones. 30 years ago, state street created an etf that inspired the world to invest differently. it still does. what can you do with spy? ♪ ♪

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dupont, nucore among those leading the gains. a lot of broad-based strength in names like 3m -- >> the cyclicals walmart shareholder meeting today, leading on greshry and digital sales to buck that trend. melissa repko is at the meeting near bensonville, arkansas, with the latest hi, melissa. >> reporter: great to see you. so, i am at walmart associate celebration. it's part pep rally and includes a star-studded lineup, including kevin hart, snoop dogg, shania twain. not only did walmart raise it's full-year forecast but they have declining online sales so the company put up 27 e-commerce

growth for walmart u.s. and that's at a time when target, home depot and others have seen declines there's really three factors driving that it is growing its third-party marketplace taking a page from amazon's book. its number of sellers in the u.s. has increased more than 40% year over year it also is attracting more members to walmart plus, its answer to amazon prime it's leaning on some grocery strength by driving more online grocery sales. it's doing that by using curbside pickup and home delivery i saw yesterday the behind the scenes of automation that walmart has been adding to its stores it added it first in bentonville after testing some technology at another location the automation is really kind of a high-tech version of a vending machine that helps employees pick and pack online orders. i spoke to walmart's e-commerce chief tom ward and he told me the idea behind the automation is to take the cap off growth,

melissa. >> melissa, thank you. melissa repko in ayetteville, arkansas. let's stick with retail. walmart may be doing well but it was a mixed bag this week. target continuing to slump, but lululemon crushes results, so what is the real state of the consumer joining us is former walmart ceo bill simon great to see you. >> good morning. how are you doing? >> good, thanks. is it that this barbell approach lives on the weaker consumer is really -- or the lower end consumer is really feeling the pressure and the higher end consumer is better positioned to keep spending >> i think right now, melissa, the story is all about food and grocery. if you've got food and walmart has food and a lot of it, well over half of their business is food, you have food inflation and you have growth. and if you don't, it's really difficult. i think the outliers, nordstrom's and lululemon shows a little bit at the upper end of

the consumer is still pretty buoyant. costco's food is down, and amazon, once forever thought to be a growth vehicle, their online retail store business is relatively flat. up a couple percentage points. >> so, food, the tricky thing about food, bill, is the margins are much thinner is that the new reality for investing in retail, you're going to be in a stock that may do well at the expense of margin >> well, i think so. i think that's been the case for the last, say, ten years as retailers tried to figure out this digital approach and the online approach. margins there have been challenging or diluted, certainly, compared to the old physical retail model. i think where we are is a bit of a temporary place. food growth is coming on a large

part on 20% two-year food inflation. 20% is brutal and it can't last. i think we'll see food inflation ease, it's going to be difficult -- the food retailers struggle a little bit and the discretionary categories will become a little more buoyant like in covid. we're in a cycle. >> you look at the projections, bill, of grocery disinflation. it's pretty dramatic, at least what the street is expecting going into the end of the year does that dynamic you just described happen in the next couple of quarters >> it's going to be difficult to tell to be honest with you, i think this 4%, 5% annual inflation is going to be with us certainly for the midterm probably through the end of the year. but then i think when food pricing abates year on year as they start to cycle -- cycle 20% two-year stacked for a while and

you'll see flat to declining food prices. and then i think it's going to be very difficult. probably end of the year, beginning of next year, would be my guess. >> meanwhile, i was looking at when we did the walmart quarter a couple of weeks ago, it was broadly seen as one of the best prints of the sector, of the quarter, and it was that acceleration in e-com that put amazon to shame. i wonder what kind of grade you would give them on that front? >> a-plus. the buyancy in their food business that gives them permission and cash to do all sort of things like the automation and e-commerce pick warehouse, they're a little behind amazon so they've got that growth by putting that automation in place and they're using the tailwind they have from the current food business to get their e-commerce business in better shape. by the way, their e-commerce business is largely held by food, too. you know, the buy online, pick in store grocery business has

been a real tailwind for them as well. >> in your view, what's wrong with target? in the past month it's lost 30 bucks, and part could be a good mix, some could be the miscalculation of where they placed their pride merchandise and wondering your thoughts on that. >> yeah, it's tough right now. i think the large piece of what they're dealing with is their historic dependency on hard lines and apparel to grow. in a better environment for them, those are, you know, really nice margin products and they do really well. their food business is always really played sort of a second fiddle to walmart and not been as buoyant with food growth the driver of retail today and discretionary categories, which is where target's strengths are, they're

really having a difficult time now, you throw in there a position that you find yourself in that by virtue of whatever side you come down on it makes half the country very angry and, you know, kind of adds more fuel to the fire. >> finally, bill, the bearish arguments on the consumer, snap, weak tax refund season, student loans on the horizon, maybe some of these delinquency numbers, do you add that up to anything? >> no, i don't i'm keeping an eye on two things we see continued strength in the labor markets and we see continued growth in wages. as long as we've got an excess of jobs and wablgs growing at 6%, 7%, the consumer is going to stay strong. they're going to shift their spending they're dealing with really, really brutal inflation in categories right now and i think they're changing the way they're spending but you see things like travel

and leisure and restaurants, dining out, the consumer's fine. they are very smart. they figure out ways to navigate through it i'm more concerned with inflation than i am with recession. >> bill, always great to get your thoughts. bill simon >> see you guys. >> meantime, earlier this morning, novartis with data showing a new drug it's been developing for patients with early breast cancer significantly reduced the risk of recurrence by 25% across a broad population company ceo will join us live in a few moments. plus, we're watching apple this morning as the stock hits a new 52-week high ahead of worldwide developer conference morgantaey snl raising the price target we'll break down that call after this , no, no, no, no, no, no. there's a problem with my paycheck. it's short. someone messed it up? i'm in the middle of nowhere. ♪ unnecessary action hero ♪ was that necessary? nope. neither are paycheck problems.

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quick check on the markets as we continue to push higher. we really turn higher started around 10:30 this morning. the dow is up by 1.7%. the s&p 500 up by 1.35% and the

nasdaq posting a 1% gain take a look at the russell 2000 leading the charge it's at session highs, up more than 2%. small caps, midcaps and the cyclical names take a look at energy stocks halliburton, transocean, apa, slb, all strong in the ocean. our chart of the week concerns food prices, hitting a two-year low in the month of may. this chart on your screen tracks the nominal fao food index since 2000 you see signs of inflation after food prices posted an all-time high two years ago, march of '22. that spiked a direct result of russia's invasion of ukraine may's number more than 20% off that level corn, wheat, grain, all significantly down, although the cost of meat did rise in may, as did sugar. four straight months of rising prices there but nothing close to what we expected going into the beginning of the war for sure. >> no. the crops were supposed to be very good this year in terms of corn and wheat and the question is whether or not food makers will pass on

some savings to the consumer or is there going to be what's known as greedflation. >> which made the front page of "the new york times. they were specific about calling out pepsi, mcdonald's, a few others. >> how much are you going to pay for a bag of doritos apparently 8 bucks on amazon fresh. >> we're in an interesting chapter of the inflation phase. let's get a news update with our bertha coombs. >> hey, carl, here's what's happening. former vice president mike pence will not be charged in the discovery ofclassified documents at his indiana home. a letter obtained by nbc news shows that the department of justice told pence's attorney, it closed that investigation the department declined to comment. pence adviser says the former vp's team is pleased but not surprised by the department's conclusion the army's fort bragg will now be called fort liberty

it was part of a initiative which came about after the death of george floyd to rename military installations that bore the name of confederate soldiers. a new study warns extreme heat wave and drought due to climate change have the potential to shock the global wheat supply and send prices soaring. the research published today looked at a worst case scenario in which extreme weather hits the wheat crops in the midwestern u.s. and in china scary stuff. carl, melissa. >> bertha, thanks. bertha coombs. after the break, citi says falling jet fuel prices could lead to a massive rally in shares of one airline stock. the price target double where the stock is trading we'll tell you the name when "squawk on the street" returns

dow up 600 time for a look at the notes catching our attention we'll start with apple morgan stanley hikes their target to 190 ahead of the monday event where they're expected to reveal their new mixed reality headset. morgan stanley says the ar and vr market could now be worth $100 billion by 2030 more than half a trillion by 2037 and that does translate, in their view, to more than $20 billion in a category for apple alone. let's bring in our own steve kovach who has to somehow make some of these projections, steve, make sense. >> exactly let me put that $20 billion in context. most companies would love to

have $20 billion in sales for a single product, but to put that in context, apple just last year in 2022, carl, guess how much they sold in iphones alone, over $200 billion so, this is still predicted, according to these analysts and morgan stanley, a tiny fraction. a tenth of the iphone sales. we've seen this so often with products that have come out from apple post-iphone, sure, they sell in tens of billions, hundreds of billions every year but not at the level of the iphone this is still the iphone company, carl, despite the optimism about the ar headset. >> this sing is not going to be cheap. some analysts say it will be $2,500, $3,000. >> i've seen $4,000. >> whatever it is, it's very expensive in a time when consumer spending is strapped. is that coming at a time when everyone is talking about ai, do you think they get to -- they have the ability to change the conversation back to the excitement that once was around

the metaverse and virtual reality? >> absolutely. apple hates saying the word metaverse. tim cook has been asked about it and other executives in his roster, and they hate using that word they don't like the term, metaverse. they see the potential of automated reality, the digital images placed on top of the real world. yes, this headset will likely do the virtual reality, but everyone is excited about ai they always talk about -- apple talks about ai as something that's more under the hood yes, they have siri but they don't have a chatgpt competitor. that doesn't mean siri can't get there one day but there's so much artificial intelligence happening on the iphone and various services under the hood that somewhat goes underappreciated there is a big part of that as part of this any time apple enters a category like this, melissa, people start paying attention i would not be surprised if this keks off a new wave of headsets from competitors by the way, samsung is likely going to have theirs at the end

of the summer. >> developers, developers, developers i do wonder, the morgan stanley note talks about both consumer and corporate demand i wonder, are we going to start talking about enterprise use cases? >> that's always -- i feel like that's the death nail when we start talking about enterprise use cases before we get to the consumer use case. take a look at the startup magically. they wanted to be a consumer product, they pared it back. google glass, rest in peace, same thing didn't work out the way they anticipated. they tried the enterprise, that didn't work out. now their project is deed. there are some ideas there was a report in bloomberg that meta's own employees don't like doing work in the metaverse. it will be hard to convince people to do that. still this should have enterprise capabilities. one thing that's been reported t did display your max screen inside the headsets so maybe you can do work on your mack while in this submerses ive environment. i've tried similar products from

meta it's not that great but maybe apple has a better idea to make that work. >> sounds like a headache. >> yeah, exactly it's like strapping a mac book to your face i don't know if you want that. >> not right now we'll see. steve, monday's going to be interesting. we'll watch it with your help. steve kovach. let's turn to airline as citi opens a 90-day positive catalyst watch on frontier they're already bullish on the name they're $19 target implies 130% upside they say the combination of dropping fuel prices and maybe getting some slots at new york's laguardia could drive some further gains. phil lebeau probably paid close attention to that note phil >> absolutely, carl. it is two catalysts citi is focused on for potential growth for frontier one you mentioned the slots at laguardia. yesterday jetblue said it entered into ran agreement where if the deal with spirit goes through, and jetblue and spirit merge, the spirit gates and slots at laguardia would then be transferred over to frontier

obviously that would be great growth potential in the number one market in the united states for them but more importantly, look what's happening with jet fuel prices citi points out their assumption, the assumption for frontier for the second quarter is jet fuel at $2.73 a gallon. it's going to be considerably lower than that. i think in april the contract was at $2.38 and it's probably lower than that right now. every five-cent reduction in terms of price going down from $2.73 is a 5% increase in the eps assumption for frontier. at the end of the day in a low-cost environment, that's when frontier does its best in terms of returns for the investor that's what citi is focused on let's look over the next 90 days, you want to be watching frontier. >> is there a benefit, phil -- can we extrapolate this benefit to other airlines, or do they hedge and their prices aren't locked in so they -- >> no, there's a benefit

there's clearly a benefit. look what we heard just the other day, was it american airlines where they came out with their guidance and one of the reasons for the increased guidance for the second quarter is lower jet fuel cost we're seeing that for a income of the carriers. that will be a tailwind, if you will, not to play on the airlines, but thatwill be a tailwind for results for the second quarter. >> thanks, phil. we have a market flash for you. t-mobile out to the response that amazon was considering adding a mobile service to its u.s. prime members saying it is not in talks to add its wireless plans to amazon prime. a reminder that an amazon spokesperson poured water on the article, saying amazon is not adding that for now. novartis, as we said earlier, out with new data on its breast cancer drug significantly reducing the risk of recurrence by 25% the ceo will join us next. and a programming note cnbc's virtual financial adviser summit is taking place june

15th scan the qr code to register or visit cnbcevents.com/financialadviser. good luck. td ameritrade, this is anna. hi anna, this position is all over the place, help! hey professor, subscriptions are down but that's only an estimated 15% of their valuation. do you think the market is overreacting? how'd you know that? the company profile tool, in thinkorswim®. yes, i love you!! please ignore that. td ameritrade. award-winning customer service that has your back. mom: hey! cheap flight alert! td ameritrade. daughter: hawaii! can we go? dad: maybe. i'll put a request in monday. sfx: shattering glass. theme song: unnecessary action hero! dad: was that necessary? unnecessary action hero: no. neither is missing this deal. with paycom, vacation is yours to manage. unnecessary action hero: not to mention benefits, scheduling, payroll. it's hr in the palm of your hand. dad: wow.

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narasimhan great to have you with us. >> great to be here, melissa. >> tell us what this means for somebody who is -- who has this diagnosis at an early stage. >> look, this is groundbreaking, we believe practice-changing data for women with breast cancer this medicine targets -- already was approved for women with metastatic breast cancer, but what we did here is we studied the medicine in 5,000 patients with early breast cancer these are patients at the early stage of the disease the goal is to treat them to prevent the recurrence of their cancer what we found is we could reduce the recurrence by 25%, very consistent data in patients who are both at intermediate and high risk. and we think this will allow us to access a very large market. duk the size of any of our competitors and really make this into one of the largest medicines in novartis' portfolio. >> as far as treatment at an early stage, often tumors are removed surgically does that mean likely using this

therapy, that it won't spread, that it ends there for a significant percentage of women? >> well, that's the goal right now what happens for women with early breast cancer, you undergo, surgical resection and historically you add hormone therapy to prevent recurrence of the cancer what we know is a third to a half of women will have their cancer recur in the next 20 years. so, what this medicine does, when added on top of endocrine therapy, reduces that risk by 25%. we hope to continue to show that this will also improve the overall survival for these women. and that's why it's such important data it's going to change the way we care for women with early breast cancer in the u.s. and around the world, when will be important for clinical practice and also a very large business opportunity for the company. >> speaking of which, the conversation quickly turns to pricing these days and also this view as to whether or not we're sort of exiting the tunnel regarding price

regulation in this country are we >> right now we're in an interesting moment when it comes to drug pricing in the united states i mean, we believe the u.s. -- the reason you have such a vibrant pharmaceutical marketplace is because the free market really works in the united states. while we need to continue to improve patient affordability at the pharmacy counter,list prices aren't showing you the real story we know pharmacy benefit managers capture 50% to 70% of the value of that list price now, unfortunately, the recent legislation i.r.a. brings into the policy environment now what we think of as price setting after a fixed period of time that's something we're working hard as an industry to try to get fixed. we also hope congress will take up pbm reform, pharmacy benefit manager reform, so we get a more sensible system, patients can afford theirmedicine and biosub

pharmaceutical companies can get more for their research. >> can you put a number for kisqali? >> we believe the early breast cancer market is in the $5 to $7 billion plus range kisqali is trending to be $3 billion in the metastatic medicine this could be a significant medicine over time we're really excited we can bring this to so many breast cancer patients. >> analysts were pointing out on the last call you had sort of mentioned a weight loss drug, which is really the big thing these days do you have one under development right now? >> we continue to explore a lot of different medicines and cardiovascular disease i would not say we had any imminent weight loss drugs in the portfolio. in cardiovascular disease we're very much focused with our r&a platform, preventing heart attacks through cholesterol lowering we have a very unique medicine as well as other r&a based

therapeutics to treat cardiovascular disease. >> it seems so easy now, vas, to lose weight thanks to these weight loss drugs. seems like sh you know, there's somebody on this have you thought, just back of the envelope or you're home one sunday night, you're thinking, well, if everybody loses weight, how will that, you know, curtail the demand for other drugs, whether it be for keeping your blood pressure down, et cetera >> look, there's a lot we don't know about how the weight loss drugs are on cardiovascular risk when you think about cholesterol, cholesterol is an independent risk factor. there are other risk factors like a blood biomarker we know each of these independently create cardiovascular risk in patients. you have to address each one of these. you could have a world, yes, where many patients are on the weight loss lowering drugs but they also need to be on great medicines to lower their

cholesterol, lower their lp, get their blood pressure under control. that's why we think there's so much opportunity in the novartis portfolio where we have rs r&as to address cholesterol and hopefully tackle hypertension. weight loss will be one component but you need to address all the other factors. it's important for patients to realize that. >> vas, thanks for joining us. we really do appreciate it. >> thank you both very much for your time. meantime, it's been a week of mixed guidance for enterprise software mongo surging and pageduty is down we're watching lulu as well. nice gains at the open on the back of those strong results and the ceo did talk to our sara eisen in the last hour sounded pretty bullish on the global picture >> around the globe in every market we're in, double-digit growth, not just here in north america but in every international market

obviously, standout performance in greater china, also apec. so very pleased with our performance across the world everybody's going to have some type of success, but are you complacent with that, that, or do you want more? this fuel, this energy, knowing that it takes work, knowing that you're going to have a different type of ethic, that's what's going to separate you from the next guy. that's what pushes you over the top.

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so boost your bottom line by switching today. comcast business. powering possibilities™. database software maker mongodb surging today. strong guidance when it comes to competitors. pagerduty and salesforce have warned and that is the focus of

this morning's check with deirdre. >> we know ai exuberance has driven the rally and the hope for some bulls is that cloud and enterprise software stocks could keep that going. the surge is helping other cloud names like snowflake, a handful of others and the broad cloud. it has been a rougher space. more scrutiny on enterprise spend, but mongodb was far more positive than some of its peers and said that there will be ai beneficiaries. on the call, the ceo said it is tough out there, but what we see is that innovation is still a priority he said, we see that customers really want to leverage software as a competitive advantage so, guys, as developers create new next-generation applications for this ai shift, they need modern platforms and infrastructure and more data

stores chipmakers, we've talked about the picks and shovels, but some enterprise software companies, they could represent the extraction tools ai aside, some analysts see the results as evidence that traditional enterprise spend looks better the second half of this year. small and medium size businesses could be bottoming and that would benefit an amazon cloud unit for all the optimism mongodb is providing, there is the pagerduty and salesforce that is lowering guidance. they aren't enough to spoil the idea that tech is a new defensive play when we talk about the magnificent seven, strong cash flow, resilient balance sheets so ai may only be the cherry on top. if you believe that, there could be a lot more room to run after

the incredible run-up we've seen this year. >> we're right back to the debate we had yesterday and that is whether ai spend crowds out legacy spend or if the rush to increase your tech budget is so overwhelming that basically everybody benefits not decided yet. >> and the whole idea that maybe everything has to be overhauled from the networking equipment to the chips, to the infrastructure and that's still very much playing out. that's why i think you see the bull and bear case in enterprise software and some of the hardware names are they going to take part in the shift. it's early and that's why a lot of investors are betting on the chips, because it is such a clear generative ai play, and mongodb made the case they're going to be providing the modern infrastructure for the shift we'll see. snowflake, too we've got to note it's up even after providing a disappointing outlook earlier on this week there's a push and pull, though.

it's up on the idea that maybe it will benefit from this ai shift. there's the short term, which we know enterprise term is under pressure, and the longer term, how much of this needs to be upgraded, for the massive technology shift that's supposed to be bigger than the internet itself. >> deirdre, thank you. wall street is buzzing about 'sai impact on the job market. the breakdown of the numbers after this break ♪ ♪ tech check is sponsored by - are asking the exact same question: is it possible? well...with comcast business...it is. is it possible to help keep our online platform safe from cyberthreats? so we can better protect our customer data? aww-yeah. absolutely. what else you got? can we use predictive monitoring to address operations issues? before they even exist? we can help with that. - hmm.

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what is wall street buzzing about this morning ai, of course, on this jobs day kate rodgers is taking a look at how colleges and universities are prepping the next round of workers to compete in this environment. >> will ai take or enhance your job? the university of florida is hoping for the latter for its students the stool has a public/private partnership with nvidia and has an ai-centric data center featuring a supercomputer as the school looks to be a national leader it's training students regardless of major in artificial intelligence. they have 230 courses in ai

across 16 colleges, and had 7,500 students enrolled in them this last spring. >> when you think about in a work environment around the table at some business, people are trying to solve a problem, not everybody around the table is going to be a computer programmer, anyway you want the marketing person around the table to understand ai, you want the communications team to understand artificial intelligence, you want all of the members of that group trying to solve a problem to understand the fundamentals of how ai is being applied to that particular problem. >> dr. reed also said the school is letting recruiters know it's going to have a student workforce that looks very different in the next three to five years because of this training and it hopes that students will have an edge in the new tech economy due to this program. >> what if you're an english major? how does this work >> that's exactly what i asked he said they're implementing this from zoology to the arts.

he gave an example of music majors, teaching them early programming and code and how to break that and put it back together and how that may interface with their major another example he brought up, pairlegals, he's like what if you understand ai and it enhances the work, you have the knowledge and bring it to the job. great points in a really big program. >> anybody who combs through data for a living and has a lot of seniority has to think a lot about these questions. thank you, great story as for the market action this morning, dow up 600 we're going to make another shot at 4280. >> i think the headline from today's session is the cyclicles making a comeback. energy, materials, industrials, financials doing quite well. small caps, mid caps with more than 2% gains here so that is something to watch in terms of seeing it persist. >> it's kind of a discussion about what's going on here, and as mike said earlier in the

hour, fears that have been subtracted, along with the possibility that maybe china gives you a goose later in the summer in the way of stimulus. that's part of the copper story today. >> exactly if we do have a soft landing, you want to be in cyclicles. >> next week we will get international eco data and of course the apple event on monday rest up for the weekend. let's get to the judge and the half. >> thanks so much. welcome to the half time report. the big rally in stocks and whether it is time to get more bullish on the markets we will ask the investment committee. joining me, bryn talkington, jason snipe, steve wies. we have a 7 plus point gain. s&p up and nasdaq is an underperforming but having a strong day, 1%, 367 is the yield on the ten-year note so you just rolled in. i wasn't sure if you we