own. stephanie. stephanie. link. >> boeing. >> thank you, mr. sethi. >> oracle. >> jyoti. >> zoom. video. >> thank you, josh brown. >> uber hot. >> right now. i'm staying long. >> all right. thank you very much again. i'll see you at 3:00 on closing bell. that'll do it for us. the exchanges now. >> thank you very much, scott. and welcome to the exchange. >> i'm kelly evans. >> here's what's ahead. >> the big. monthly jobs. >> report is on deck. tomorrow and you might want to buckle up. we could see some big swings, not just in the monthly figure, but on what really. >> happened with. >> job growth over the past few years. we'll tell you why and how markets might react. >> plus, one. >> incredibly important group of stocks that is significantly underperforming so far this year. i bet you know it well. and they haven't underperformed like this in over a. >> decade, our analyst explains. >> whether it's a blip or a breakdown. taking shape. and three more names due out with

earnings including amazon later today. and this name our mystery chart that tim seymour says he's getting ready to buy on a pullback. not much of a hint there, but if you think you know it tweet me tim will join us on that in just a bit. let's start with the market landscape though. and dom chu brings us that. as always dom what can you tell us. >> all right. so kelly what we have right now because of that maybe wait and see mode for the big jobs report coming up tomorrow, is a market that is moving just modestly both to the up and down side today. now, what i will tell you is that the dow continues to lag, but it's only off about one quarter of 1%. that's good for 103 point drop to a level of 44,771. the s&p 500 has been pretty much positive all day, even at the lows of the session. we opened up just about flat there, so just no movement. but we were actually up about 19 points at the high. so we're tilting towards the higher end of that range. right now. the 15 point gain is good for a one quarter of 1% gain to a level of 6076 for the s&p 500. the nasdaq composite is at 19,751. it's good for about a 5859 point

advance, again, one third of 1% gain there. so the outperformer if you want to call it that, but very much a wait and see given the big jobs number tomorrow, that's probably one factor. but deciding why these stocks are moving the way that they are. another place to look at right now is the single best performing sector in the s&p 500 modest move today, and that is the financial sector. and we're talking names like jp morgan chase, wells fargo and goldman sachs each up about one and a 1:45 percent in each of these gets a star. because each of these stocks at one point today hit record highs. so goldman, wells fargo, jp morgan chase, the financial at least near-term momentum continues in this market. we'll see if it can last. and then kelly mentioned amazon. maybe the main event if you want to look at it this way in terms of earnings for this entire week, amazon shares right now currently up about two thirds of 1%. we are not far away from record highs here and amazon. just to give you some perspective on just how volatile things could get, the options market is pricing right now, what could be a 6.5% roughly

move up or down on the heels of earnings? and that sounds interesting because it is almost exactly what the move has been up or down in amazon shares for the past eight quarters. and by the way, five of the last six quarters amazon shares have been higher. so we'll see if those near-term trends play out. kelly for amazon i'll send things back over to you. >> all right, tom, thank you very much. >> and let's. >> get you set up for that big. jobs report in the morning, because. >> it's going to be complicated. and it could. >> change what we think we know about the. >> labor market. >> cnbc's senior economics reporter steve liesman is here to tell us why. steve, over to you. >> thanks, kelly. yeah. with tomorrow's jobs report, the government is set to release the largest upward revision to population, labor force growth and jobs in the history of the household survey. the reason the census bureau, using new methodology to account for the surge in immigration over the past several years. it's a big number. the government now expected to announce a 3.5

million upward revision to population, dwarfing past january revisions. you can see there. while it accounts for immigration over the past several years, it's going to put all of the change in january of this year rather than revise the prior year's data. that's the custom for how it does it. goldman sachs estimating this upward revision of population at 3.5 million, will add to the household survey 2.3 million jobs and only marginally affect the unemployment rate by four basis points. this should not impact tomorrow's payroll number, the one that everybody watches, which is estimated at 169, down from 256 in december. but it will move employment in the household survey much closer to the payroll survey. you can see those big gaps that happened since the pandemic. those weak household numbers led some to think the economy may have been weaker than it appeared. that evidence now largely goes away, as does the argument. the new challenge, though mass deportations promised by president trump, forecasters

have to figure out what role immigrants have played in the economy, and the effect of deporting them will have on jobs and spending. we could be reducing kelly this massive upward revision by this time next year. and by the way, tomorrow we're going to get a chance to talk about these issues, the revisions, what they mean, how they change the outlook for jobs. with an exclusive interview after the jobs report with minneapolis fed president neel kashkari. kashkari. that's at 8:40 a.m. on squawk box. kelly. >> so just to make sure i'm following the payroll, the stronger number the past couple of years, they're. >> going to. >> say that that was the correct one. so the labor market was stronger than we thought. >> yes. and the household survey down there will be some adjustments to the payroll survey as well. you remember that was for a slightly different time period. that will be a downward revision to payrolls of maybe 800,000. we don't know exactly what that's going to look like. but in general, the household survey is the one that's going to get the big revision, because we know that there's been a large influx

of immigrants into the country. they were not necessarily counted. and by the way, you got to give a hats off to goldman sachs. kelly, they have been on this story from day one. yes. and one of the things that the government did was sort of pick up some of goldman's methodology in terms of how it was figuring this stuff out, as well as using some other things. it's a complicated thing to really to count essentially undocumented immigrants, but they found ways they think they know how to do it. and we know these folks have come in, these people have come in, and many of them have jobs. and so now we're going to add that back to the prior years. >> steve, one more question then i'm going. >> to bring in our guest. >> but so i've been following obviously the goldman story for over a year, maybe a couple of years. they've been saying it's stronger than you think. you should trust the payroll data. and they've been right. but didn't we have a big revision last year? that was a. downward revision. >> that made everybody think. >> that wasn't the case. am i getting confused? >> you know, kelly, what i always say, if you're not

confused, it's because you're not paying attention. you are correct in terms of how you've been following this data. we're talking about two separate surveys and two separate revisions. my report was about just the revision to the household survey. there were also be revisions to the payroll survey. that will be a downward revision, and the two will meet much closer. but the payroll survey has been strong. it will remain strong. i forget the number of jobs that will be taken off, but it will still be a very high number. there will still have been many, many people, much, many more people employed than actually were estimated. and that job strength in the payroll survey will remain, but it will be a downwardly revised as well. so you're not wrong. it's just two separate surveys. >> okay, so a quick google search just. >> to make sure i'm not crazy. last august, the bls. revised down to payroll jobs 818,000. are you. saying does. >> that go away now? >> no, that will remain. that's the payroll side of the survey.

that's the 800 000 revision through the year ending in april of last year. that will remain. but my point is that even when you take that 800,000 off, you still have tremendously strong job growth. i can get you those numbers of what it will look like afterwards. we'll get the one year, the full revision, and then they'll parcel that out, i think later this year, over the course of months, the payroll survey will be downwardly revised. the big story, though, the much bigger revision is going to come in the household survey. >> right? so even. >> with that. >> downward downward revision to payrolls that time, it may be this time again, that survey has still been closer to capturing the strength in the household survey was understating it. okay, i think i've. >> got it. >> i think that's right. that is right. and i can figure out for you i had these numbers for a prior report. i did what you do. you'll say 800,000 off a very large number. and i'll tell you what, that was it for the year ending in april for the for the revisions to the payroll survey. >> i'm glad to do this now so that in the morning we're all at

least mentally kind of ready to digest what they tell us. let's bring in. >> the. >> guest now, steve, stay right there. who does say that immigration is essential to the labor market? because they don't just fill open jobs, they. create them. here to explain is evan stone, the ceo of ora intelligence and a senior advisor at recruiter.com. evan, did you follow all that? >> you know, i caught the 800,000 number the same way you did. i'm like. >> that's the same number we just. said was overstated. >> so i'd love to. steve, i'd love to see your math. >> by the. >> way, i think the other number. >> it's. >> not my math. it's the it's not my math. it's the government's math as well as goldman sachs affirming it. >> i hear you, i get. >> again, kelly, thanks for having me back. the other number that i think is going to get affected, steve, is the is the employment number, the total percentage of people that are employed. right. that number. so the overall population that are employed, that's actually going to go up. right. >> that's another interesting thing that's going to happen. i didn't get into that detail.

what's going to happen is you'll have a larger number of younger hispanic people that have a somewhat higher unemployment rate, a somewhat lower employment to population ratio, but a somewhat higher participation rate. and i didn't want to confuse everybody with that, but it. shouldn't mean it shouldn't it should not mean a massive change to all of these. all i can go with is the goldman numbers. they see just a four basis point. what that means is if unemployment was 4.1, it would be 4.1 for the participation rate. goldman estimates to be 11 basis points. and there are times. kelly, i wish sometimes i thought better of doing certain stories. maybe this is. >> one of them. >> no. steve. >> can you imagine. >> what it's going to be like when this hits tomorrow morning? >> and it's. >> like. >> no. >> this narrative. no, this. there will definitely be a newsletter or maybe two on this. evan, i do think your point on immigration was interesting. what have you found? >> so there's really three. >> areas of.

>> immigration, right? >> there's the highly skilled h-1b visa professional roles filling. >> the. >> highly skilled labor market, open roles that if we if we tighten up immigration rules, there's going to be additional wage pressure on those roles. and we already saw the jolt number from last month that the quit rate was. like below pandemic pre pandemic levels. so if those highly skilled folks don't want to quit their job and you can't get them from overseas or some, or. >> you. >> can't get them through immigration, the wages are going to have to increase there. the second group of immigrants are really in the lower salaried level roles, and clearly there's going to be an impact. we saw in the jobs report an increase in hospitality jobs in our restaurant report, an increase in restaurant overall jobs. and again, if you can't find the labor to fit those jobs, either wages again have to increase or businesses are going to have to adjust and maybe look through automation or do something else.

the third area, which i think is really something that we need to talk more about, is that so many small. businesses and small businesses. >> are such. >> a catalyst for job creation in this country, and there are. >> so many. >> immigrants that are doing small businesses. you know, i started to use some chatgpt to find out. give me all the top companies that were started by immigrants and it's still processing. it's that it is a pretty sizable market. >> well, we it's a common talking point on the. >> show, evan. >> how much we're using chatgpt for everything. so i appreciate you running that one, steve. also, i'm looking ahead to kind of the jobs report months down the road. the bigger kind of concern. >> has. >> been that we could see. >> the. >> headline numbers slowing. i don't know if we're also going to have to contend with that in the morning. >> as a cross. >> current, because of immigration. >> and. >> other factors. >> yeah, obviously, by the way, you have some fires and maybe even some additional hurricane effects in tomorrow's number. we'll see if that ends up being an issue. that's one thing. and you're right, i don't i'm trying to think through kelly. maybe

evan has some thoughts how what's going on in the federal government will have an effect here. if these folks are laid off, they might eventually end up in the jobless claims numbers. perhaps there's some additional hiring you could hav, doubling up where the federal government ends up hiring to replace them. and then, of course, if you are doing the deportation issues, then those jobs will come off over time. but then you have to really question the ability of the government to count these bodies. coming in and out is very, very difficult. you can see here census went through a very long process to try to get this right, and perhaps they did now and then it's going to shift the other way. so it just takes time. sometimes you got to look out your window kelly, and find out what's happening in the economy. it's there have been a number of, of data, data points that suggested the economy has been strong. if, for example, you had weak gdp growth but strong job growth, well, maybe

those jobs numbers are wrong, but you've had above average gdp growth. you had above average job growth. those sort of go together well. >> and that's why i know that evan's correct about, you know, immigrants and small businesses. i see it firsthand every single day on that point about government. evan, you did have some data showing already a big downward blip there, right? >> the other thing that's interesting, kelly, we talked about this probably months ago. the speculation that people had two jobs, two full time jobs, and they were being double counted in this job creation. and then we hear from doge and again, not to get political, that, hey, some federal workers actually had full time jobs. so being asked to come back to the office, gee, that's going to affect their other full time job. >> so i didn't. >> hear that. we're going to see some numbers being changed that way too. >> i had i hadn't caught that. that was from some bank executives during work from home who thought their employees might have been double dipping. so it's interesting. >> that that. >> was picked. >> up there as well. all right. so maybe we lose two jobs for every one or something. but in

the morning i feel much more prepared than i was before. thank you both. steve liesman evan stone on the jobs report. meanwhile, let's go back to the markets. we've already heard from four of the mega-caps this earnings season microsoft, apple, meta and alphabet. we've got amazon after the bell today. it hasn't been the best earnings season so far for the group with the exception of meta. in fact, if you look at the mag seven minus tesla, which my next guest calls mag man, it has been a rough start to the year. they've long lagged the broader s&p by 4%. that's the biggest underperformance in 12 years. is it just a blip or a breakdown for big cap tech? let's ask larry adam. he's the chief investment officer at raymond james. first of all, why exclude tesla larry. >> well. >> we just view that more. >> as a consumer related company. >> not as much your traditional technology company. and then when you do look. >> at the earnings. >> of that particular company, there is a little. >> bit. >> more volatility associated. >> with it than. >> the typical. >> mega-cap names. >> that. we see. >> so for the most part, we've excluded it since. >> we've been doing this for the last couple of years. >> well, i mean, i'm not going

to get into a whole thing about it, but they do with all of the robotaxi self-driving stuff. i think probably more of the market cap is tech based than consumer based. >> i mean, that might. >> be the case. >> but ultimately. >> they sell cars, and that's the number that most, you know, when wall street looks at, you know, how many are being delivered, etc. >> so we just feel that if you look at the broader scope of where tech is going with with. >> ai and the. >> and not. >> just looking at it more from a singular focus of cars. >> i think. >> it's more important to look at the broader tech space. and plus we. >> have more of a history of. >> what they've been able to do. >> what they've been able to do with their. >> margins when it comes to reinvesting. >> and looking for. >> that next, next great. technology to. come out, they've been much more keen. >> to do. >> buybacks and dividends. so those companies that we tend to focus on. >> those top. >> six tend to have more. >> in. >> common than with the other company. >> tesla. >> that. >> you mentioned. >> so is this underperformance so far this year just a blip or is it a larger breakdown? >> i actually think it's a blip. you know, it's one of our

favorite sectors as we came into the year. you know. >> one of the. >> reasons why it's so important for us is because when. >> we do. >> our survey data. >> with clients. >> every quarter. >> believe it or not, technology. >> is the. >> favorite of 75%. >> of our. of our clients. that's pretty big. the next closest one. >> is around 50%. >> so it. >> is a. >> sector that everybody. >> has a lot of interest in. >> i still. >> think that. >> it will. >> continue to do well going forward. when i look at its earnings growth, you know, we mentioned you mentioned earnings growth this particular quarter. we still. have those. stocks growing their. >> earnings at 27%. that's versus. >> 10% for. the rest of the market. and they're. >> expected to continue to. >> outpace the. >> broader market for the rest of this year. and then the one thing contrary to what a lot of. >> people think when they. >> look about. >> talk. >> about valuations. when i look at the valuations of madmen, it's approaching. >> the lowest levels that we've seen since 2018, really. so i think it's getting. >> much. >> more attractive. >> from a valuation perspective as well. >> so you think people should just be buying hand over fist. don't worry about, you know, the pivot to health care. don't worry about the pivot to i don't know what else financials. >> i wouldn't. >> say hand. >> over fist. i mean we do believe in a broadening. >> but when i say broadening, i. >> mean other. sectors will

perform just. >> as well. >> or similarly to technology, right? >> i do think that technology is. >> going to continue. >> to dominate. remember. those madman. >> stocks represent 30%. of the s&p 500. so it's a very big. >> portion of it. one thing i would mention, though, is. >> that they only represent about 23%. >> of the earnings. >> and the significance. >> of that is that you. >> have to continue. to see those earnings continue to grow. >> so that madman actually grows into its. weighting within. the s&p 500. >> so that's why. >> it's. >> so important that they have to continue to drive this earnings momentum going forward. >> now i think i need to ask chatgpt to make a mad man graph or what is it like dali or one of these image generators? i think we should do that for next time or our talented graphics team right here, larry. thank you. appreciate it very much. thank you larry adam with raymond james coming up ralph lauren and tapestry are soaring on earnings beats while canada goose is under pressure again. bank of america's retail head walks us through the risks and her favorite picks in this space. plus, we're closing out the busiest week of earnings season with amazon on deck

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2022. my next guest has a buy rating and notes they import less than 10% of their products from china, which could insulate them from the tariff impact. let's bring in lorraine hutchinson. she's a senior retail analyst. lorraine, it's great to see you. let's just dwell on this one for a moment. after that failed, they were taking over or capri or capri was taking over them regardless. doesn't seem to matter now. well. >> kelly, that deal's off the table. so tapestry was going. >> to buy capri. >> but that's been completely walked. >> away from at this point. >> and i. >> think what you're seeing today is. >> the. >> strength of the tapestry. >> platform come. >> through in earnings today. >> and that's the owner of koch. and what other brands? >> koch. they own. >> kate spade and. >> they own. >> stuart weitzman. >> i think the. >> highlight today of this earnings release was koch. sales up 10%, which everybody's laser focused. >> on right now. >> to me, there are two much. >> more important. >> data points. underlying that growth. number one, koch. >> is. >> attracting a younger customer at higher price points, which

every brand really wants. >> right. >> and number two, they're doing it at higher margins. gross margins were up 280 basis points this quarter. that was a huge surprise. and both of these factors. really highlight the strength of the. brand and the consistency of what we'd expect. >> on a go forward basis. >> you know, i should have known if everything else is coming back into style from 20 or 30 years ago, that koch would be the logical next choice. where else, rl? i know that's not one you cover per se, but they had a strong period. it's an odd moment for retail. i mean, you have names like peloton popping you. you know, the fashion mix is shifting. the tariff questions are there, but there seem to be a number of names. is that because the bar was low that they're that they're popping? >> i think, you know not everyone's had a. >> great earnings season. i think. >> what's really standing out to me. >> is those companies that are giving. >> the customer value. >> and as i was saying with koch, they're bringing in customers at higher price points. value doesn't have to mean the price. it means what you're getting for that price. so if you're getting a really well crafted leather handbag for

$300, and you're used to paying a lot more for a luxury bag, that could be a sign of value. and i think the customer who continues to struggle a little bit with discretionary wallets, you know, is really, really looking for value in this environment. and we're seeing that in a lot of different places. >> yeah. when i think about, again, the high price of eggs, the high price of coffee, a lot of these everyday things people run into, the flip side of that is, you know, they don't really have to shell out in areas like apparel. so that plus the tariff threat, does that leave the rest of your coverage space vulnerable to margin pressure for the rest of the year? >> sure. i mean, look, the 10%. >> tariffs on. >> china are really the thing we're focused on. we estimate that our group, the apparel imports, are about 10% of their total cost of goods. so if you think about that, it's only about a 25 basis point headwind to margins. that's pretty manageable in the scenario where there's a universal tariff where all imports are tariffed, we would see a much higher impact. and our scenario analysis

assumes no price increases. exactly. because of your point, the customer has been pressured by a lot of other inflationary areas in their budget. and so what that's meant over the course of most of 24 is apparel spending was pressured because they just simply didn't have a lot of money left for it. instead, they're searching for this value to make their dollars stretch further. so we'd be looking to companies that have lower import exposure, like bath and body works, that produces 85% of its product domestically, or retailers that are offering some extreme values for a stretched consumer, like the off price space, like a ross stores or tjx, those are our plays for how to manage this tariff risk as we move through the year. >> super interesting. quick final question. the de minimis, you know, getting rid of that. and i guess making all of these things that the rise of temu and sheehan have facilitated, i guess, a little bit more expensive. i mean, i haven't seen how this is playing out firsthand. i know those apps are trying to shift people to kind

of buy local, buy us, but i don't know how much of their inventory it can really satisfy that demand. is that now a major kind of tailwind for these other more traditional retailers? >> i think it is an opportunity. you know, we've seen this de minimis rule allow for some advantages of direct imports. and that's caused some of the deflation we've seen in apparel over the past few years, apparel and other goods. and so now what the us based companies need to do is really highlight that value in the face of potentially higher price points from some of their competition. so i do think it's a real opportunity. >> right. or again not you know amazon's not on the list here but they would seem like a natural beneficiary. so it's interesting that kind of small change is part of the moves. this weekend could actually have big effects. lorraine, thanks so much for joining us today. appreciate it. lorraine hutchinson with bank of america. coming up, state and local governments have shelled out more than $30 billion over five decades to build new sports venues. but are they a good

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>> welcome back. we have lots of breaking news out of washington. let's get down to eamon javers for the details. eamon. >> kelly. there's a. >> lot going on here. the first. >> thing is. >> that. >> a federal. >> judge up in boston has. >> now. >> issued a temporary. >> injunction blocking that so-called. >> fork in the road. effort by elon. musk and. >> the doge team. >> to offer. >> a deferred resignation. >> to federal. >> employees in september. >> the deadline. >> for accepting. >> that. >> offer was supposed. >> to be today. >> but now the federal judge is saying that. >> at. >> least until monday. >> that offer is going to. >> be. >> suspended. >> giving both. >> sides in. >> a. in a. >> lawsuit over. >> the. >> issue a chance. >> to. marshal their arguments. >> and the. >> judge a chance to hear them all out. >> there was. >> a. >> lawsuit filed. by federal employee unions, and. >> the. >> unions were arguing. >> that this was. >> not only unfair, but. >> illegal under what's called the. >> antideficiency act. >> which means that the. federal government can't obligate. >> any. >> funds that. >> haven't. >> been appropriated by congress. >> the judge saying. >> it's. going to. >> take his. >> time to look through all those issues. >> so this will. >> be held up at least until

monday. >> and federal employees. >> are. now expected. >> to get a. >> notice from their employers. >> telling them. >> that the. >> fork in the. >> road so-called offer. >> is now on hold. >> i guess is the best way to put it until monday. separately. >> nbc news. >> is reporting that about. >> 60,000 people have already. >> accepted that offer. >> unclear what. >> this new temporary injunction means for. >> those folks. >> but at least some interest. >> among the federal workforce. >> to take that offer. >> and then thirdly. >> i just want. >> to. >> update you on a wall street. >> journal article. >> that just posted a couple of. >> minutes ago. the white house is preparing an order. >> the journal reports for thousands of federal health workers to be laid off. >> the wall street journal. >> is saying that. >> it's. >> working on the. >> white house, is working. >> on an. >> executive order to file to. >> fire thousands of. >> u.s. department. >> of health. >> and. >> human services workers. >> under the. >> order of the fda, centers for. >> disease control and. >> other health. agencies would have to cut. >> a certain percentage. >> of employees. so we'll wait for confirmation. >> from the white house. >> on that. kelly. but clearly. >> the efforts to pare back. >> the federal. workforce are

moving. >> ahead on. >> some fronts, even as. >> the federal judge. >> now judge now is issuing this temporary injunction. >> holding off the overall. >> fork in the road effort to cull the. >> federal workforce down to a much smaller size. >> back over. >> to you. to put it differently, eamon, we could say there's nothing standing in the way of layoffs, although maybe the union to some extent. so if they don't allow the buyout offer to move forward, then we could see more layoffs as a result. >> yeah we could, although. >> i would imagine the unions will fight those layoffs too. remember, this is not like a. >> private company, kelly. there's federal civil service protections. >> for individual employees. those rules have been. >> in place for. over a. >> century. >> and they're. >> there to prevent. >> presidents from coming. >> into office. >> and then staffing. >> the federal. >> government with all their supporters and. >> friends and allies and donors. >> and stuff like that. >> that was a. >> big. >> problem in the 1800s. they stopped doing that, gave federal workers these federal civil service protections, which. >> made it. >> very hard. >> for a. >> president to. >> fire individual workers and. >> replace them with political people. so traditionally.

>> only the top. >> people inside the federal. >> government change. >> over in every administration. >> those are the so-called political people inside. >> the federal administration. >> under them is the vast civil service. those are the career people and those always stay. >> this now. >> is an effort to get at that vast number of career employees. >> and you're going. >> to see, i think, a lot of fight from the federal employee. >> unions to try. >> to. >> push back. >> on all. >> of. >> that. >> know that history is illuminating, because it's ironic that the careerism has become a political fight when it was established to avoid political favoritism. >> it was originally a good government effort, right, to get rid of cronyism and corruption in government. yeah. now there are people who say that's gone too far and you can't fire federal federal employees easily enough, and it's time for an update on that. but these sort of vast, sweeping things that elon musk and the doge team are considering are going to run into some legal hurdles. and you're seeing now the unions and others. fighting back with these lawsuits. ultimately, the courts are going to be determinative here about how far the doge team is able to go in paring back.

the federal workforce, and then also how many people simply decide they want to take the offer. as we said, nbc is reporting 60,000 people have already said yes. that's not huge relative to the size of the federal government, but it does indicate some people are saying, okay, i'll hang it up for eight months of free pay. >> i've heard many are a little spooked by some of these questions about how exactly this would work. eamon, appreciate it very much. eamon javers in washington. let's get to seema mody now for the cnbc news update. seema. >> kelly. good afternoon. the u.s. justice department is suing the city of chicago and illinois over immigration policies. in a complaint filed today. the doj said three of the states and cities ordinances, which give protections to state citizens and city residents regardless of immigration status, interferes with federal immigration officials from carrying out their duties. president trump will sign an executive order sanctioning the international criminal court for targeting both the u.s. and israel, according to a fact sheet from the white house. the order will use both financial sanctions and visa restrictions against unnamed court officials and their family members found to

have helped investigations of u.s. citizens or allies, and a bipartisan group of lawmakers moving to ban china's deep seek ai chatbot app from government devices, saying the app is a national security risk. it comes after cybersecurity firm fruit found hidden code that could capture users login information on the app and share it with china's largest state owned mobile firm. kelly. >> we talked about that with ivan yesterday. seema, thanks very much. seema mody. meantime, there's a whole lot that goes into hosting the super bowl. i don't mean at your house, i mean at a stadium. you need two great teams, a killer halftime guest, tons of food and amenities, and of course, a mega sized stadium to hold it all. but they don't come cheap, as we know. which is why a combined $13 billion in public subsidies was proposed last year to finance pro stadiums in 12 different u.s. cities, but that only covers a portion of the total cost. who pays the rest? and are stadiums a good investment? let's ask dan klose. he's head of municipals at nuveen. dan, it's great to have you. my knee jerk reaction

is like, i can't i can't imagine they are. they always seem like a boondoggle. but what can you tell us? >> yeah. >> and it's the entire idea of using. >> muni bonds. >> to finance arenas. >> to finance stadiums. it's for. professional sports. it's a it's a controversial topic in muni's. and we don't have many. >> juicy. >> controversial topics in muni. >> but if. >> i could. >> just as. >> far as. >> two quick background. points before getting. >> into how you. >> could profit from it. >> one is when you have. >> local officials. and state. >> officials want to go in and use taxpayer dollars. >> and use. >> muni bonds to. >> put together. >> a stadium or an arena. it's with a thought that it's going to go. >> in and spur economic growth. >> it's going. >> to spur jobs. you're going to have bars. >> and restaurants. >> come in to an arena district. >> in columbus, ohio. >> you're going to go. >> in and. have all this knock on. >> effects, and it can often work. >> and it. >> can often work. >> i mean. >> the results. >> are mixed. i mean, you. >> do. >> have like cobb county that clearly has benefited from moving the atlanta braves and going. >> in and. >> having the knock on effects there. >> and there's some. >> that don't work as well. but the other thought is that when you think of stadium.

>> financing, it's. >> not for the scoreboards, it's not for the different parts in the actual arena or the stadium, the luxury box. it's all the. wraparound financing. so the chicago bears, my chicago bears are asking for 2.4 billion for their new lakefront stadium. >> and it's when you say asking for is that from the market? is that from public subsidies? >> yeah, it's from public subsidies from ultimately issuing. muni bonds for these. and it's for public transportation. it's for putting in a new road. it's for putting in greater utilities, water and sewer. and as you mentioned in your opening, there are 13 different or 13 billion being asked for by 12 different cities. and we're going to see, i think, more issuance coming from this in the coming year as these become more expensive. >> it's tricky because a lot of the fan base loves it, right? i mean, who wouldn't want a great stadium, a great experience? we all complain about getting back and forth to games and that kind of thing, but is it a good investment? >> yeah, and. >> i think. >> that's what we really focus on. our most recent paper is the difference between the perceived risk that your team has to do.

well. my bears won five games last season. it's very difficult to go in and to watch this and say, gosh, i've got to make sure my team's doing well and people are showing up versus the actual risk. and the actual risk are these are bonds that are generally very high grade. they are. >> higher risk. >> yeah. well high grade on this meaning. >> no high grade i'm sorry. >> yeah. >> meaning not high yield. yeah. >> yeah. so if you look at the buffalo bills they just issued $500 million of debt. and that debt all came from a double-a county. that is a very, in our opinion, a low risk. the tennessee titans just issued $750 million in debt from the city of nashville. again we think very low risk. and so that difference between the perceived risk of you have a project finance and it's got to do well and your team has to do well versus what the actual risk are of. in the case of tennessee, the state came in for a $500 million issuance of a triple a rated entity. the actual risk is much different. and so you can really profit from going in and buying these on new issue, because there is that difference in what is being financed, which

is stadium and assumed to be risky versus what is actually backed by which is sales taxes and general obligation. >> to make the analogy, it's kind of like mortgage backed securities, right? you think i don't want to back any homeowners, but if the government is basically going to backstop the default, then i could. so the strategy you think is actually to buy some of these on issuance, because it's when they get the headline risk, there's a lot of concern. maybe they have higher yields because of that perceived risk. but in reality they're often backed by the stronger state and local government. >> yeah, that's exactly it. and we looked at, for instance, the buffalo bills. they issued 500 million of what they called bills, bonds. and again, that's from the local county where the stadium is built. we looked at other 4% coupon structures that were already outstanding for the same full faith and credit of that county. and we found that you picked up on this new issue about 35 or so basis points. same with tennessee. the bonds backed by the triple-a state of tennessee. when they were going and issuing these bonds, there again, was this perception from the retail market. >> but i think about chicago. i mean, i don't want to bring illinois into this, but not not

every state is triple-a rated. and does that mean in those markets people should just be aware of who is the ultimate backer of this? >> well, and for illinois, let's say, for instance, there is an actual issue and authority by the state and it is backed by sales tax bonds. and even in the heart of the pandemic, when hotel occupancy was down 8,090%, just given how much funds were in indentured health funds, given how much overcollateralized they were, you didn't have those defaults. >> so damn close. says it's okay. it's okay. you can help fund your local stadium build out. no, i don't want to put words into your mouth, but i do think it's a good context to think about this weekend and i appreciate it. good to see you again, dan. thanks. dan. close with nuveen. sportsbooks are also getting ready for a record billion and a half dollars worth of wagers on the super bowl this weekend. you're going to hear from a lot of the betting ceos fanduel, draftkings, fanatics, betting caesars bet mgm they'll all be on throughout the day. tomorrow we'll get to field a ton of different questions about this. it all starts on squawk box at 7 a.m. eastern. and still to come, amazon's at an all time

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>> market zone commercial free coverage sponsored by e-trade from morgan stanley trade commission. free today with no account minimums. >> welcome back. it's been kind of a rough earnings season for big tech so far, with the exception of meta. and now we hear from amazon after the bell we'll cover that name affirm and expedia in today's earnings exchange. our trader is tim seymour. he's the cio at seymour asset management and a cnbc contributor. appreciate it very much tim. let's start with amazon, especially after hearing some weakness in microsoft and google cloud. you know, we've got obviously questions about aws revenue growth on the retail side, how to how to how did holiday sales do. what's your take here? >> well, we. >> know holiday sales were great. >> i think. >> the question around. >> aws is what's going to. drive the. >> stock based upon microsoft. based upon google. i think there's a little bit. >> of an. unclear dynamic here, but anywhere. >> 19 to. >> 20%. >> aws growth again, we're back into growth here. >> and i think. >> this would be continuing a. >> trend that really. >> did start to get a whole lot better. so i think that is key.

we know workloads are increasing. we know demand is increasing. so i. >> just think. >> it's getting back to both what that number is. but then the margin overall. >> i'd say. for. >> both e-commerce and overall. >> for aws. i mean, i think. >> the margin dynamics. >> are a. >> pretty good story. >> operating income. >> seems to be moving higher. the stock overall. >> despite really. >> outperforming most of the mag seven over the last six months. >> i mean, it's up 50%. >> over. >> six months. >> it's outperformed the nasdaq. >> by about. >> 15% over. the last year. >> but it's not it's not expensive relative. >> to itself. it's about 26 times forward. it's double. >> that on a five year historical. >> so i really. >> like amazon. >> relative even. >> to this peer group right now. i think there's a lot of balance between the e-commerce, which. >> we all know. >> those holiday sales were great. >> we know where they are on those secular trends in e-commerce. >> and i think they can prove the profitability there, too. >> you kind of echoing what larry adams said where he thinks as well. he said valuations for the mag seven outside of tesla are at their lowest since 2018. so interesting. after the performance we've seen let's

talk about a firm then because susquehanna recently downgraded the name and they're a little focused on how much user takeup there was during the holiday season. you know, buy now, pay later obviously is always a little bit of like a political football as well. do you like the stock? >> i don't. >> like the stock. >> but it's not that they're. >> not executing. >> i think right. >> now, buy now, pay later trends are fantastic. and i think between. e-commerce strength, consumption. >> strength, those are all things that are helping they and other. players in the field. i think i'd rather be in mastercard and visa on that front, but when you look. >> at buy. >> now, pay later, i think it's. it's certainly. >> a trend that continues. >> when i. >> look at a firm. gmv is growing. they've just. >> raised a fair amount of money, 5 billion. >> or so recently. >> to have more. >> access to capital. i think. >> the margin profile is fine. i just feel. >> like this is a credit. >> story that. >> when the music stops, it's not going to be pretty. >> i don't know when the music's. going to stop. i just wouldn't chase it. it's not it's. not cheap. >> it's five time, five. >> and a half times revenue. >> so but. >> they're taking market. share

in a space that's growing for the bulls. >> that's the story. >> i think you're right to a lot of people would rather just sit in visa and mastercard and kind of see how it plays out. what about expedia? that was our mystery chart today. good job. i think it was oyster capital who got it first. piper sandler analyst are watching how much vrbo has grown in the past few months and actually, whether the california wildfires hurt some demand and trends there. expedia is up 46% over the. past six months. >> huge. >> huge run, i. >> think relative. again to peers, though, if you're, you know, relative to bookings, it's probably seven turns cheap relative. >> to airbnb. it's probably half that. that p e multiple. the trends in the us you know hotel. >> and for. >> people that are really. >> digging. digging into the sector, i mean the revenue per available room. numbers in the us have been fantastic. >> so they're going. >> to. >> support expedia. >> i think this is really a story where the trends are decent. stocks had a huge run. >> i think you're. >> probably buying weakness. i don't think you're chasing this one. but right now those us trends are strong. >> all right. amazon's yes affirms a no. for now expedia is

a maybe maybe. yeah tim thanks. sounds good. appreciate it tim seymour. seymour asset management meantime the strong dollar has been one surprising headwind for the mega-caps and names like uber as earnings come in. deirdre bosa takes a look at the impact that could have on amazon tonight. hi deirdre. hey kelly. >> so the magnificent seven they generate of course substantial portions of their revenue overseas. so when the dollar strengthens as it has those foreign sales translate into fewer us dollars when they report. and we've been seeing that certainly from meta, microsoft and google a few nights ago. it is likely to be a headwind again when amazon reports tonight. but forex headwinds they will impact big tech to varying degrees. so we took a look. here is where each of the mag sevens international revenue exposure stands and how it has changed really over the last year. as you can see apple and meta. we're going to pull up this image for you. apple and meta are most exposed in terms of how much revenue they generate abroad. nearly two

thirds for both of them. nvidia is next, with more than half of its revenue derived internationally, but it has also seen the most change in that makeup. last year, it increased its us revenue exposure by 44% over 2023, thanks in large part to export controls and the hyperscalers enormous ramp in capex. now, amazon actually has the least exposure, with just about 30% of sales coming in from abroad, still continued dollar strength. that could significantly impact guidance like it did for meta, microsoft and google. and what may be different this time are elevated levels of trade uncertainty introduced by the new trump administration. the usd is seen as a safe haven amid those tensions, and kelly maybe even perhaps more than dollar strength, sort of rising protectionism. we see that lawsuit or the probe in china into apple's i mean, when they're getting so much of their revenue abroad, the stuff is going to matter more and more. >> yeah. and it really has been i'm glad you're highlighting it, because it's been one of those factors that kind of can swing

the stock and people didn't quite expect. deirdre thanks deirdre bosa in techcheck. coming up, if you're waiting for those robo taxis well we've got some robo trucks for you. one company just delivered their first ones to help automate an industry. the ceo joins us to explain next. >> techcheck is sponsored by comcast business. powering comcast business. powering possibilities. your record label is taking off. but so is your sound engineer. you need to hire. i need indeed. indeed you do. our advanced matching helps find talented candidates, so you can connect with them fast. visit indeed.com/hire

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your dream office a reality. >> welcome back. elon musk sees tesla's robotaxis hitting the road this year, as alphabet's waymo are already in use in several cities across the country. but what about the industrial side of autonomous driving? haven't heard a lot about self-driving trucks in the last few years. one company, though, just delivered the first self-driving semi trucks in west texas, and they're being used to automate. get this the sand delivery supply chain. let's bring in dan burnett. he's the founder and ceo of this company, kodiak robotics. he's here. dan, you look like you're 25. congratulations and welcome. and why is it called kodiak? >> oh. thank you. well. >> kodiak, it was. >> a it was a. >> it was one of those things where we were looking. for a name that. >> was had the right feel. >> to it. you know, the. >> kodiak bear is. >> the largest and most.

>> aggressive bear. >> in the world. >> and also. >> there's a. >> kodiak plane. >> which is. >> kind of like. >> a hauling plane. so we kind of felt like there was a little. >> bit of a twist. >> there. >> that makes a lot of sense. i didn't know that i was thinking more like alaska connection. so these are we should say they're not on the road in west texas. they're being used in west texas. what can they do and what powers this technology? >> well. >> kodiak robo. >> truck is a. >> revolution in the way goods are moved. >> so, as you said, there's no longer a driver. >> in. >> the cab. >> these trucks are moving completely. >> on their own. >> this has been promised. >> for over a decade. >> and now it's. >> finally here and. >> it's. >> being deployed. >> in production. >> these trucks. can go to where the owner tells them to go. so we work with a customer called atlas energy solutions, and. >> they. have an interface that they can say, go pick up goods here, go drop it off there. and they're moving sand for atlas out in west. >> texas. >> but not on the highways. like i'm not going to drive down the highway. these are not approved on the highways yet, i imagine. >> not yet. so the. >> technology is. effectively the same as what. >> we use on the highway. >> we actually. >> work with a bunch.

>> of great companies for. >> highway delivery as well. >> there. we still have a. >> safety driver. >> we're working with folks like j.b. hunt and warner enterprises and ikea. >> and so. >> the technology. >> is right around. >> the corner. it'll be. >> on the highways. >> before you know it. >> so which technology? there's lidar and what's the other one? and this is the whole fight between, you know, tesla and waymo, right? >> yeah. so we. >> use the more of. >> the. >> waymo sensor suite approach. >> we have. >> camera we. >> have lidar. we have radar that we think that those. >> sensors all have. >> really important strengths to actually keep. >> the truck safe. >> for instance. >> out in the desert there's. >> a. >> lot. >> of dust. radar sees. >> right through that dust. >> and so. >> it's a very powerful. >> sensor. but we have an end. >> to end ai. >> solution that's powering this, this, this system. it really is state of the art. >> and it's able to. >> drive in a variety. >> of diverse environments, including. >> over the road. >> on the highway surface streets. and then, as you see. >> here. >> off road environments. >> who created and developed that self-driving technology? is it you guys, or is it a third party? >> that's our that's. >> our core business. we are

the. >> creators of. >> the ai software. >> that does the driver. >> so the one. significant thing about this. >> announcement is that it's the. >> first time. >> a customer is actually owning and operating the. >> operating the vehicle. so we're not we're not running. >> the assets like other autonomous fleets. >> that you might know of. >> we purely work on the ai software. that's our that's. >> our. >> proprietary system. >> interesting. so are these electric don or are they traditional, you know, sort of gas or i guess diesel powered trucks. >> these are traditional. >> diesel, diesel powered trucks. for now, of course. >> electrification is right. >> around the corner. we're super excited about. >> what what possibilities. lie there. >> however, we're agnostic. to the drivetrain. we've outfitted our technology on on battery powered. >> electric trucks before, but we currently work on diesel because diesel is more ubiquitous within the industry. >> what if it has to back up? >> our system can actually back up, right? and if the if the system ever. >> gets stuck. >> or it can't handle a certain. >> situation. >> especially around pickup. >> and delivery, we. >> have the. >> capability to. provide remote assistance and maneuver those

vehicles as as necessary, particularly at low speeds. and so the trucks can really do it all. they can pick up the goods, they can pull through, they can back up, they can. >> they can. >> drop off. yeah. it really is a seamless end to end system. >> that's fascinating. i appreciate you joining us to talk. obviously, it's been a few years since self-driving trucks were in the news. i think we should send sully down there to take a ride in them and check it out. brian sullivan, don, thanks for your time. don burnett from kodiak robotics. and before we go, take a look at shares of will scott hopping on a report from semafor that they're in discussion with the u.s. customs and immigration enforcement, or ice, about leasing mobile structures to house undocumented detainees. will scott rents trailers and mobile offices. shares are popping 3%. we've reached out to the company and we'll let you know if we hear back and that's it for us. thanks for watching the exchange, and i will join brian sullivan for power lunch. but he's in a mystery place right after this quick break.

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bundles at super beats. >> com. (grandpa) i'm the richest guy in the world. (man 1) i have time to give. (man 2) i have people i can count on. (grandma) and a million stories to share. (vo) the key to being rich is knowing what counts. >> hi and welcome to power lunch. i am kelly evans, holding down the fort in new jersey today. and brian, hello. >> i am brian sullivan, as you can see behind us. >> kelly not. >> new jersey. this is our washington, d.c. bureau and we have got a big hour kicking off right now. we're going to look at whether or not spin offs tend to work out a few big chip names getting chopped and inflation. you can feel and taste. the