Fed Reset, AI Growth & Inflation Shapes Markets 6/18/26

 Trump posts, Intel spikes. I'm Morgan Brennan and this is your morning call.
 Good Thursday morning. One down, roughly 32 meetings to go for Kevin Warsh,
 as the new Fed Chair's investors continue to digest his first decision as Fed chairman in what
 was seen as a hawkish hold for the central bank. If you take a look at futures right now,
 they are higher this morning attempting to bounce back the S&P up about or poised to open up
 about 55 points, the Dow 185, the Nasdaq, the big mover to the upside this morning pre-market
 poised for gains of 380 points this morning. This, of course, after a big reversal lower amid
 that Fed Chair press conference yesterday and a hawkish hold from the Fed yesterday as well. The
 Dow actually touched a record intraday high in trading yesterday before closing down 1%,
 the S&P also closing lower and the Nasdaq as well. And bespoke calling this,
 what we saw yesterday for the S&P, the worst first day for a new Fed head since 1994 from
 a stock market perspective. This morning, President Trump posting that Apple will be working with Intel
 on new chips and Tim Cook, also telling the Wall Street Journal that the company will be forced
 to hike prices due to the global chip shortage. You can see shares of Intel spiking another 9%
 this morning. Apple is up about half a percent as well, much more on all of that throughout the
 hour. Bond traders meantime now pricing in at least one rate hike between now and October.
 So a huge move in treasuries yesterday. And as we get a check on that this morning,
 US two-year treasury, the Fed sensitive US two-year treasury yielding 4.17% it hit 4.22 yesterday
 at the highs of the session. Ten year, though, is under a little bit of pressure. The yield 4.44,
 9% right now. Well, let's take a look at the dollar index two because you're seeing the dollar
 a little bit softer against other major currencies this morning. Oh, and I take that back.
 Dollar indexed up about half a percent. 155 is the level there. And of course, we saw the dollar
 strengthen amid that hawkish hold yesterday too. Energy as President Trump and Iran sign on memorandum
 of understanding aimed at developing a permanent peace deal. Though President Trump did say that
 he's keeping military action on the table should a deal fall through. If you could see right there
 on your screen, oil continues. It's moved lower here this morning. WTI down another 2.7%.
 Just under $75 a barrel and Brent crude down more than 2% as well trading around $77, $78 a barrel
 are about gasoline also under a bit of pressure this morning. And actually, we've got the national
 average for price of regular gallon of gasoline falling below $4.2. We'll have more on that this
 hour as well. That's according to AAA. We're watching shares of SpaceX after the first down day
 as a public company yesterday. It was bound to happen, right? You could see pre-market though.
 We're up another almost 1% to SpaceX shares this morning are trading around $193 a share.
 We're going to have more on that stock also. A filing we got from SpaceX yesterday after the bell.
 Let's see how Europe and Asia are taking all of this news. Lisa Kim is standing by in Singapore.
 Ben Boulos has the early action out of London. Ben, let's start with you.
 Yes, the European equities very much on the back foot in early Thursday trade. Investors
 watching those developments in the Middle East after US President Donald Trump and his Iranian
 counterpart sign the memorandum of understanding overnight. The Fed's hawkish hold in Kevin
 Walsh's first press conference also very much front of mind for traders this morning. This is the
 picture across the main benchmarks in Europe. You can see it is the FTSE 100 seeing the sharpest
 falls this morning reflecting that fall in the oil and gas price of the oil and gas majors in
 Europe listed on the London index and pulling it lower. The Fed isn't the only central bank in
 focus though. Plenty of decisions in Europe today. Switzerland's SMB held rates at 0%. Norway
 central bank follows suit keeping rates on hold at 4.25%. And we are looking ahead to the
 Bank of England's decision with markets also anticipating a hold there. The Governor Andrew
 Bailey has said the bank has time to assess the fragile truth from the Middle East and its
 impact on inflation. We'll have more on that throughout the day. Morgan.
 All right, Ben Boulos. Thank you. Yeah, I mentioned this yesterday. I'm going to mention it again
 to worth noting. In all this week, more than 20 central banks are counting for upwards of 40 percent
 of world output making rate decisions this week. The Fed obviously getting the most focused but
 all of these other banks also in the mix here to the overnight action in Asia or Lisa Kim.
 Record highs once again for South Korea and for Japan as well, Lisa.
 Hey, Morgan. So Asian stocks shrugged off hawkish fast signals. Stocks mostly closed in the red.
 All things continued. AI and tech rally. Depends on K-2-2-5 and South
 Chris Cosby indexed both closed at all time highs. Japanese flash memory maker Kyosya added less
 than a percent and it recently became the most valuable listed Japanese company by market caps
 or passing Softbank Group and Toyota. Japanese tech investment giant Softbank Group searched more than
 4 percent in today's trading. In mainland China, tech stocks were the clear winners after one of
 its exchanges issued rules to help AI large model companies list, even if they're not yet profitable.
 So a Chinese index tracking 50 of the largest tech companies there advanced to a fresh
 intraday high. Now in terms of currencies, a hawkish Fed and sort of a stronger dollar push,
 the Japanese yen weaker to the mid 160 handle to the dollar. The Japanese currency remains weak
 partially because of the still wide gap in interest rates between the US and Japan. Morgan.
 All right, Lisa Kim. Thank you. Well, bond markets may be pricing in a hike before October,
 at least here in the US, probabilities on calcium paint a more split picture,
 but just 57 percent expecting a hike before the end of this year. 88 percent expecting one by
 the end of next year. Here's Kevin Worsh yesterday on the likelihood the Fed moves the other way.
 Was there any discussion of a rate cut going forward today?
 There was one proposal on the table. There was no discussion of any other proposals.
 The discussion on that proposal I would say was quite limited. The group was unanimous and
 known ambiguous on it. All right, and that was our job. We can make strong growth,
 low prices, and strong employment, mutually compatible. And so what you heard from the committee
 today is we've got some work to do on the price stability front. And of course we have these task
 forces looking at studying, researching, identifying all the different ways the Fed goes about
 carrying out that dual mandate. So more on that throughout the coming months as well. Joining me now
 on this so much more Lynn Alden founder and principal at Lynn Alden investment strategy.
 Lynn, it's great to have you back on the show on the one hand Worsh and a Fed with a hawkish hold
 on the other hand war and a deal to make a peace deal. What to make of it all?
 Well, I think the combination is that even though he has to kind of be hawkish going into this,
 you know, condition type change since he was nominated and he's he's coming into this,
 you know, hot energy situation hot CPI prints for the past, you know, a couple of months.
 But that's contrasted by the fact that most of the data suggests that things should be
 using a little bit in the months ahead. If this if this, you know, peace deal holds, we should see
 energy can kind of continue to come down that should reflect in the data. And that should take
 off some of the kind of the more hawkish speed that they might have to otherwise deal with.
 I think they are committed to, you know, trying to get inflation under control. And he he pretty
 firmly removed speculation that he would, you know, just be a puppet, you know, Fed chair.
 He shows he's going to be independent. But I think that they will have patience in the coming
 months and quarters to see how inflation is trending, even though it still is above target.
 Yeah. And that does seem to be a takeaway from quite a number of reports after that press conference
 yesterday, this idea that this new Fed chair has established independence or reestablished
 independence here for the central bank. The balance sheet, how should investors be thinking about
 that over the longer term, too, just given what we have heard from Kevin Warsh over the years
 about that. And the fact that one of the task forces that they do have reviewing things at the
 Fed is focused specifically on that piece of the puzzle. Yeah, he has been a long term hawk on
 the balance sheet. That's been a pretty consistent theme of his. And we'll see what the results
 of the task force are. It is notable that in what is a very short statement by the FOMC,
 they did reconfirm their commitment to ample reserves, maintaining ample reserves in the system.
 They have a variety of tools that they could eventually explore, such as, you know,
 easing regulations on banks to let them hold more treasuries, or easing regulations on lending for
 other entities to hold treasuries. So I think they're going to avoid major liquidity problems,
 and I think they slept that in there. That was actually probably one of the more dovish
 aspects of this is that the hawk on the balance sheet in his first statement leaves ample reserves
 in there, and what is otherwise a very stripped out statement. So I think that they have some tools
 they can play with, but I wouldn't really expect like massive balance sheet reductions any time
 in the near future. What does all of this mean for the dollar? And perhaps just as importantly
 then, what does all of this mean for commodities like gold? Well, because this was a slightly
 hawkish leaning presser and overall release, I think that the response we saw made some sense.
 There's immediate gold sell-off, there's immediate jump in the dollar, jump in in shorter-term rates.
 I think gold had a very strong tier run. There's no sign that it's found the bottom yet
 of the current correction that it's been in as the enthusiasm comes out of that trade.
 My expectation is it's not going to round trip the gains that it made, but I still think it's
 early to jump in if you're a trader from a trader's perspective, trying to figure out where exactly
 this is going to land. I think as we move into a more multipolar world, gold does hold a very
 powerful position as a neutral basement resistant, hard to confiscate asset. And I think that's
 continue to be true. So I think a lot of the price gains it has are kind of a permanent
 re-rating, but it did get very heated there. I don't think that gold traders should expect
 the cavalry is coming in the form of major dovish interactions anytime soon.
 Yeah, and light of that idea that maybe the debatement trade re-emerges here, what does it mean for Bitcoin?
 So I'm pretty bullish on Bitcoin. I think in the near term, it still has some
 choppiness to probably go through. It didn't really manage to hold. It's February lows. It
 mildly dip below those, which is not constructive for kind of near term, but I think that
 whereas gold had that very strong two-year run and is still elevated by a lot of standards,
 Bitcoin's kind of near the lower end, kind of the bottom 10 to 15 percent range for a lot of
 its kind of valuation metrics or sentiment metrics. A lot of the leverage has been already
 washed out through liquidations and de-risking. So I have a probably a more favorable view on Bitcoin
 in the two-year view, but I think there's still a process to go through to confirm if the bottom
 is fully in. Okay, Lyn Alden, great to have you on to start the hour. Appreciate it.
 Thanks for having me. We got a lot more to come here on morning call, including
 quote unquote, unfortunately unavoidable. We got much more on Apple as Tim Cook deals with the
 realities of a global chip shortage. Plus, fighting words from CME Group Chief Terry Duffy,
 as he takes on perpetual futures in court just before he retires. And later, jumping the
 Gemini ship for chat GPT, why Sam Altman says his latest hire will be worth the wait.
 We've got a very busy hour still ahead, morning call, dry back.
 Welcome back to morning call. We've got a news alerts with drones. Okay, actually,
 I'm going to give you a check on the futures market right now. As you could see, all the major
 averages are poised for a rebound after a late-day swoon yesterday, with the S&P poised to open
 eight cents of a percent higher, the Dow Hire as well, Nasdaq as well, the big mover this morning.
 And you could see right there, Dow Gainer is this morning, Caterpillar Boeing, Travellers,
 Amazon as well. And it's a mixed picture for Treasury yields, and in the meantime, Dow laggards.
 You could see Chevron is lower, Johnson and Johnson, Coca-Cola, McDonald's. We'll be back after this
 break. Welcome back, news alerts. Switzerland's foreign ministry saying that initial talks between the
 U.S. and Iran are planned for tomorrow at a mountaintop resort near Lake Lucerne. That's
 following the signing of that ceasefire agreement yesterday. President Trump signing the memorandum
 of understanding on a potential peace deal to end the war before dinner in Versailles, France
 last night with French President Emmanuel Macron, who was sitting right next to him, Iran's
 president also digitally signing the document. While the prospect of easing mid-east tensions,
 helping drive retail gas prices lower, AAA says the national average for a gallon of regular
 gasoline. It's now back below $4 a gallon to date, ever so slightly, by a penny. As you can see
 on your screen, we'll take it with more, though. Let's get to our Dan Murphy at the OPEC Summit
 in Vienna. Dan, what does the prospect of this deal mean for OPEC, especially when according
 to this MOU? It's 60 days that Iran is going to enable traffic to move through the
 Strait of Hormuz without any sort of toll or fee. That's exactly right, Morgan. Good morning
 to you, and we're live outside OPEC HQ, global oil headquarters here in Vienna for instant market
 reaction that analysis to this 14 point MOU that has now been electronically signed between
 the United States and Iran ahead of that ultimate signing ceremony that's going to take place
 in Switzerland. We're going to a couple of key points here, and just engaging the reaction
 from analysts, it really does seem as if the verdict is still out on this deal. On the one hand,
 analysts that I've been speaking to are very optimistic to see the war come to an end, and Iran
 never having nuclear weapon, and also, of course, the Strait of Hormuz reopening, but at the same time
 as well, lots of questions about the specifics of this deal, and how soon we could potentially see
 flows actually normalizing through Hormuz once again. At the same time, there's also sanctions
 relief for Iran here, which means we could potentially start to see Iranian barrels already coming
 back to this market sometimes soon as well. And according to the IEA, given the fact that the
 market is still oversupplied heading into 2027, but that's a key concern. We've already seen
 prices react to this as well, of course, Brent Crude now back to the 70 USD handle, or at least
 near to it. The other thing we're picking up on the ground here is the fact that there are still
 a lot of negotiations to come on this deal. On the question of what happens over the next 60 days,
 a lot of emissions here, not just on the financing side, but also on the sanctions relief side.
 Analysts here also saying they're concerned about the fact that we have also seen Iran's missile
 and drone program being left off the table. That could potentially expose critical
 bulk energy infrastructure into the future. And of course, the nitty gritty on the nuclear deal
 is still not necessarily resolved either. So the U.S. certainly paying a pretty big price to
 win the war with Iran. The question among analysts on the ground here is at war cost.
 Let's back over to you. All right, Jan Murphy, thank you. We've Brent
 trading below 78 bucks a barrel. And of course, all of this is going to raise questions about
 what it's going to take to replenish all of those missiles and munitions and weapons stockpiles
 that have been expended in this conflict as well. And by the way, not just by the U.S.,
 but by those allies in the region, too, and this idea of defending all of that critical
 infrastructure moving forward, which is why our next guest is joining us. Defense readiness.
 This is a central focus. So the Pentagon's roughly $1.5 trillion fiscal 2027 budget request,
 placing a priority on the industrial-based personnel, modernizing forces to deter global
 threats and enhance operations. But despite these investments, the U.S. military is facing
 the so-called readiness gap driven largely by supply chain constraints. You've heard
 me talk about it quite a bit. We'll be joining you now, Tara Murphy-Dowardy, CEO of Air,
 which just rebranded from Govini earlier this week. And it's great to have you here on set.
 Welcome. Thank you. I'm so happy to be here. So when we talk about, first of all,
 congratulations on the name change. Enterprise readiness. That is what you are presenting
 to the world here through the operations you have, the AI-enabled operations of the company. What does
 that mean? It means that there's a huge market really in solving the readiness gap that you
 just alluded to more again. And we believe that enterprise readiness is the right way to name the
 work that our company's been doing for more than eight years at this point. Enterprises because
 there is no single actor that can close this readiness gap alone. And readiness because making
 sure that the force is available and prepared to protect American national interests is really
 the most important thing. So what can AI and the services that Air is bringing to the table do to
 close this readiness gap, especially at a time where obviously it's a critical juncture when we do
 look at things like missiles and munitions, stockpiles, and help depleted they've become.
 They're so depleted and the demand for them keeps increasing. So when we talk about the readiness
 gap, we're really talking about the difference between what the front line needs. And that's the
 front line whether we're talking about military operations or protecting the American border or
 we're talking about frontline health workers. And so the gap between what the front line needs and what
 United States is delivering to them today is the readiness gap. And the challenge that we need the
 government to realize they need to address is the fact that this is a continuously held state. It's
 not a static moment in time. And readiness today is measured largely as a series of static metrics.
 You can use AI, you can use software, you can use great capabilities today to achieve that
 continuous state. And that's what it's going to take to close the gap.
 Yeah, I'm going to have this conversation as some senators are marking up parts of the annual
 defense policy bill, what's known as the NDA, cracking down on shareholders returns with
 defense contractors, which is tied to an executive order we got a couple of months ago.
 But how does that speak to what it's going to take to ramp production to the levels that are needed
 as quickly as possible when we do have this broader conversation? Absolutely. It is related because
 there's a lot of pressure on defense companies right now to deliver on what the department is asking
 for. The Department of War is saying we need more equipment, we need more material, we need more
 munitions. And the deliveries are years behind. Now, there are a lot of reasons for that. You
 mentioned supply chain in your opening. That's a big part of it. But there's an accountability gap
 in this industry as well. And I would give Deputy Secretary Feinberg a lot of credit in this regard
 for holding people's feet to the fire. And I think this is one measure of that.
 I just before we wrap this up, I have to ask one more question and that is, what do investors need to
 understand about contracting with, partnering with, working with the government when we talk about
 new technologies with AI? I mean, clearly it's in focus with what we're seeing with Anthropic.
 Absolutely. And that is the perfect idea because I think the single thing they need to understand
 most importantly is that the mission comes first. And if that mission focus and mission orientation
 isn't a genuine part of your company's DNA, or the company that you're considering writing a
 check to, it's going to come through to the public service members civilian and military that
 the company is trying to work with. Put mission first and the business success will follow.
 It's hard in working with the government, the business side of things, but it's achievable.
 Okay. Tara Murphy-Dorothy of AIR, it's great to have you on set. Thanks for joining me.
 Thanks so much Morgan. Well, the Senate Armed Services, we just touched on it,
 but the Senate Armed Services Committee has approved a must-pass bill with a provision
 that could bar some defense contractors from making stock buybacks or paying dividends
 without the Pentagon's approval. The Annual National Defense Authorization Act was approved
 in a closed-door meeting last week. This is the workup coming out of that committee on the Senate side.
 The inclusion of the buyback provision increases the odds of the bill becoming laws setting up
 a potential sea change in how the Department of Defense works with some of the country's largest
 companies, and as I mentioned before, certainly stems back to what we saw with the executive order
 earlier in this year as a lot of these big legacy defense contractors and even some of the new ones
 are leaning into new business models to ramp production as quickly as possible. Well, still on deck,
 Elon Musk taps an old colleague to join him at SpaceX after that stock's first downbase
 and it's going public. We've got the full story. Coming right up.
 Hi, Morgan Brennan. Welcome back to Morning Call. Let's get a check on US stock futures,
 which are attempting a rebound this morning after a late-day selloff tied to that hawkish hold from
 the Fed. You can see the Dow poised to open up about 250 points. The Nasdaq, the big mover this morning
 up 423, S&P up about 62 points. That's after all the major averages fell 1% or more yesterday.
 Treasuries, if we take a look there, you can see it's a mixed picture across the curve. US
 two-year treasury yielding fed-sensitive two-year yielding 4.17% at the highs yesterday,
 afternoon 4.22% just huge moves there in the last call at 24, 18 hours, 24 hours.
 10-year treasury yielding 4.45%. Getting a check on energy with crude prices lower again this morning.
 WTI down about 2.5% just below $75 a barrel. Brent crude down about 2% trading around $78 a barrel.
 Around the world, it's a mixed picture for Asia. We saw the Cosby, top 9,000 for the first time,
 Nikkei and Japan also at a record high. For Europe investors are bracing for the Bank of England,
 Central Bank decision at 7 a.m. Eastern also expected to be a hawkish hold. Let's get a check
 on some of the morning's latest headlines, though. Tim Cook telling the Wall Street Journal that
 Apple plans to raise prices in an effort to offset the rising cost of memory and storage chips,
 Cook who steps down in September, calling the price hikes, quote, unfortunately unavoidable.
 But stop short of saying how big the price hikes would be, or which products would be most effective.
 Apple is reportedly on track to release its first foldable iPhone in September along with
 the iPhone 18. Now, those Cook comments come as President Trump and a post on Truth Social,
 just a few hours ago, confirmed that Apple will work with Intel to manufacture chips in the United
 States. And if you take a look at shares of Intel and Apple this morning amid all of it,
 Intel spiking another 9% premarket. Apple is also up premarket by about half a percent.
 So one of the chief architects of Google's Gemini is leaving the company to join OpenAI.
 And in a post on X, Nome Shazir, Shazir says he's excited but is still, quote,
 incredibly proud of the amazing team at Google. The departure comes less than two years after Google
 reportedly paid $2.7 billion to bring him in. The former head of startupcharacter.ai along with
 his team of researchers. Well, OpenAI chief Sam Altman says that it'll be worth a wait.
 SpaceX mean time is adding long time musk friend Ally and PayPal Mafia member,
 we'll look both at to the board of directors and audit committee, both the previously
 served as managing partner at Sequoia Capital, which holds a roughly 1.5% stake in SpaceX.
 That move coming after SpaceX posts its first losing day since its IPO, falling nearly 5%.
 But you can see bouncing back right now up 1% premarket.
 CME Group mean time, CEO Terry Duffy telling CNBC that his company plans to sue the CFTC over its
 approval of perpetual futures or perps, which are derivatives that allow traders to maintain positions
 indefinitely without the need to roll over contracts. Duffy breaking the news on CNBC's fast money.
 You know me, I'm always up for a good battle, I've never shied away from one
 and I won't shy away from this. I've been working on this plan with my board for eight months.
 I didn't start working on it two weeks ago Friday when there was a quick approval of a perpetual
 future. So this takes a lot of time, a lot of fiduci, this is the biggest obligation of any
 public company board and my board took it very seriously. Well, in a statement, the CFTC says that
 it looks forward to addressing the claims and is dismissing the quote, frivolous lawsuit.
 You can also see what Brian Armstrong at Coinbase had to say about all of this and my
 interview with him earlier this week at CNBC.com as well, because there's a hole back and forth here.
 In the meantime, you take a look at where the exchanges are trading this morning. You can see
 higher right now, premarket, fractually, for everything from CME to NASDAQ to ICE and CBO.
 Well, New York City and New York Knicks fans in particular will have another chance to celebrate
 their team's first NBA title in more than 50 years today. The city will hold a ticker tape
 victory parade up the canyon of heroes for the next. It's going to start at 10 a.m. Eastern.
 And the overwhelming enthusiasm over the next championship is also coinciding with record
 TV ratings for major sporting events. You have the NBA and NHL finals. You have the World Cup
 and generating record revenues for leagues and team owners. Let's talk about all of it. Joining us
 now is Chris Morangie of Gabelli Funds, who's a longtime holder of several sports talks, including
 Nick's parent company MSGS. And also joining the discussion, CNBC Senior Sports reporter Michael
 Ozanian. It's great to have you both here. Mike, I'm going to kick this off with you.
 Obviously, huge moment, not just for sports, but also for media.
 Oh, absolutely. Talk about the merger happening in media between Paramount and Warner Brothers.
 The big picture here, I think, in this great summer of sports, as you coined it, is how
 the sports ecosystem is still expanding. How sports leagues and media companies are still monetizing
 it. And really, the upshot is for team values, they're going to continue to go up. And, you know,
 we've seen this with some sales of small stakes of sports teams. The Raiders sold a minority
 stake for a $9.9 billion valuation. The NBA is looking to expand. We're hearing expansion fees,
 possibly being $7 billion, $8 billion. So team values, this is not a bubble. Team values are going
 to continue to go up. And I think the NFL and the NBA in North America are best position to capitalize
 on this. And internationally, you mentioned the World Cup, soccer is still the king of global sports.
 It is. And as part of the reason why you've seen a lot of big-time American investors get
 into European soccer, for example, as owners of the last couple of years as well. Chris,
 want to get your thoughts on this. And specifically looking at the next, what a win here means for the
 company and means for shareholders in the stocks. Right. Well, it's a nice perk when your team wins,
 but the stock has been on a winning streak, which is even better. And we're more interested in
 compounding wealth for clients. And one way to do that is to own sports franchises and members of
 that ecosystem. These are scarce assets that are stores of value, AI resilient, sickly resilient.
 And that's when we love them. Okay, Mike, you said this is not a bubble. Why is this not a bubble?
 Well, because you're seeing media companies fight for the rights to sports teams, sports leagues.
 So they're going to continue to pay more. You're going to look at the NFL, which is renegotiating
 its rights early. You could see a 50% increase in the rights for NFL games. NFL dominates TV ratings.
 You mentioned the ratings of what's happened to the NBA, the NHL, the continuing to be strong.
 Sports content is still the one thing you want to see live. And we've seen this. You mentioned the
 next, the watch parties that they've had. We've got to go back a number of decades. You couldn't even
 watch the home team playoff game, the NFL game. It was blacked out locally. You couldn't watch it.
 The theory was what people wouldn't go to the game. If, you know, buy tickets, if it was on now,
 you're seeing the opposite, the amount of ways you can consume the content is expanding. And that's
 going to enable more money to flow into these teams and leagues. And as revenue grows and the amount
 of investors looking to institutional money is now coming into the leagues, that's going to push
 team values up. Yeah, and not to mention what sports betting does to the entire ecosystem. I would
 imagine too. Chris, I've heard it compared to investing in or holding stakes in some of these
 teams to the other real asset. As a scene as a real asset, whether it's real estate or a fixed
 hard asset that there's only so many of, and that's sort of the key here to investing and how you
 need to understand it. So I wonder if you see it the same way. And if so, where you see the most
 compelling investments right now. Yeah, so there is some element of that. It's also compared to
 fine art, but they're a little different. As Mike mentioned, there are some financial underpinnings
 here. The growth in media rights, sports betting, other elements, live entertainment,
 a lot of money to go to a game and buy those beers, etc. So it's not totally just buying,
 you know, gold that sits in a vault. These are growing assets, and we'll continue to grow it.
 In my view, there's a lot of other elements out there, tax elements in particular, which
 actually make it likely that some of the public sports assets, which are even more scarce than the
 global ecosystem of sports assets go private. And the nicks and the rangers are actually
 splitting their company, creates a lot of options for them. I think it's been largely responsible
 for the run that that stock has had this year. But among my favorites, our MSGS, and of course,
 we are very large sherry holders of the Atlanta baseball club that a long baseball season had of us.
 All righty. Chris Morengi and Michael Zanian, great to have you both here. Thanks for having me.
 I love that. Summer of sports stock picks is what we just did right there. A lot more to come here
 in morning call, including we're back in Paris for Europe's largest tech conference with our
 Karen show live from the floor, Karen. Good morning again from Paris, Morgan. Yes, I've been having
 lots of conversations about AI disruption and how will impact the job market? Morning call up to this.
 Welcome back. Shoemaker turned AI compute provider, all birds continuing its AI pivot,
 the company officially rebranding to the name Smart Bird announcing Nadia Carlston as its new CEO,
 Carlston previously led Amazon Web Services Quantum Computing Center, worked at the US Department
 of Homeland Security. Stock has been extremely volatile. It has a very small market cap less than
 a hundred million dollars, and you can see what we're not going to show to you, but it's been all over
 the place. All right straight ahead, Fed fireworks, Apple price pressures, dealer no deal, deal.
 The morning call crew is going to tee up the trading day ahead.
 Here's what to watch today. We get data on jobless claims monthly Philly Fed survey,
 earnings from Accenture and Kroger before the bell this morning. Bank of England decision
 announcing that it's latest interest rate decision. It'll announce that it's 7 a.m.
 Eastern she said US Supreme Court scheduled to possibly release opinions at 10 a.m.
 Eastern, which could include a ruling on the legality of President Trump's move to fire a
 Fed governor, Lisa Cook, and get the New York Knicks celebrating their NBA championship with a
 ticker tape parade of the canyon of heroes in lower Manhattan that also starts at 10 a.m. Eastern.
 We've also got quadwitching because it is a holiday shortened market week as well trading week.
 It's time for your call sheet crew members today Chief Economist, Veronica Clark Carson
 Group Chief Market Strategist and CMBC contributor Ryan Dietrich. And on set with me,
 Jones Trading Chief Market Strategist, Michael Rourke, lots to get to. As is always the case, Mike,
 I'm going to kick this off with you. Fed fireworks. What was your take away from a brand new Fed
 chair ushering in a brand new era at the Fed and day one with a stock swim? I mean, it was pretty
 remarkable to have in war sure that he will be independent. It's something that we've been waiting
 for for a long time. I think the most interesting takeaway was when they asked him about
 where does he think about where monetary policy is today. He said it's broadly restrictive,
 but except in the financial markets. So that is obviously that that helped add to the sell-off
 and I think that's something people need to be aware of here. Yeah, I mean, it's not necessarily
 wrong either. I think Main Street has a very different, it has felt a very different impact
 than Wall Street has. That's for sure. Ryan, your thoughts take away from the Fed yesterday?
 Well, first off, thanks for me back and good morning, everyone. I enjoyed the long holiday here
 and congrats on the win with the nicks. Everybody enjoy that today. So you think about it more
 than yesterday. You guys have talked about it all morning. I want to talk about the market's
 reaction, right? Almost 430 stocks in the S&P 500 were down yesterday. That was the most number
 of lower stocks we've seen all year since the last day of last year. Usually you have a bigger
 down day when that many stocks are lower, so that kind of caught my attention. But one more thing,
 you have to go back to 1978 when Volker took over. The last time stocks were higher on the first
 Fed meeting. So it's normal to see some kind of confusion and actually big weakness on the first
 Fed meeting. So I'm not overly shocked by that. I think the bottom line, this is stillable market.
 We still have a lot of participation, just two last comment, just two days ago. The New York
 Stock Exchange advanced decline light in all time high, small cap advanced decline light in all time
 high. Mid cap was right at all time high. This is ill abroad based rally. Yes, a weakness right here
 might make sense, but we're not overly concerned. Yeah, Veronica, one of your get your thoughts on
 this, especially given the reaction we saw in the bond market. I mean, you had a split Fed in terms
 of the dot plot and that strips out wash who didn't put his dot plot in, I think as to be
 expected, but the surge we saw in the two year treasury yield. How to think about that?
 Yeah, no, it was a hawkish surprise, of course, but it's still very divided Fed and we've seen that
 before. So I think the most hawkish element of the meeting and why we saw that move higher into
 your treasuries is that we had a lot of officials expecting that they're going to be hiking rates
 this year. A lot of people placed a dot for one or more, someone even expecting maybe three
 rate hikes for for the year. So markets, of course, are reacting to price in some of that risk.
 But I would say and worship this in the comments at the press conference that these are very rough
 forecasts. They're penciled with pencil and they could change it. Yeah, speaking of pencil
 done with pencil, we got washed on one hand, Mike. We got wore on the other. We got this MOU
 signed by President Trump and his Iranian counterpart last night. Devils in the details here
 over the next 60 days, including what happens with a straight-of-war moose because it's just a
 toll-free fee-free agreement with Iran for the first 60 days. Then we don't know what happens.
 Yeah, I mean, it's going to be interesting to see how the summer plays out here. Once again,
 we're rallying on this memorandum of understanding, you know, in the stock market.
 And I think we've priced in these gains multiple times at this point. And the reality is
 we need to get to a final resolution here and move on from this conflict. Hopefully,
 I actually think if we can move on from it, I think it's very bearish for oil.
 Oil had very bearish fundamentals to begin with. And that does lead, you know, we will get inflation
 to come down with oil correcting. So it'd be great to move this process forward and get to a final
 resolution here. Yeah, Veronica, I want to get your reaction to that because I mean, we have seen
 oil drop like a rock here this month. And Brent's last I checked below 78 bucks a barrel. So how
 does that contribute to the forward looking inflation picture? Yeah, absolutely.
 Veronica, I'm going to come to you. Yeah, no, absolutely. Headline inflation is looking better.
 I think as soon as June will see that look better. It's still elevated, of course, on an annual
 basis. But it is, you know, a good development that that has come down. We've seen some pass
 through to core inflation, things like airfares. But if businesses do perceive that this increase
 in transportation costs and energy costs was only temporary, we really haven't seen the pass
 through of that to other types of goods and services. And maybe we don't get that if businesses can
 just absorb those costs for just a couple months. So it is a really important element for the inflation.
 I look if in oil is coming down. Okay, Ryan.
 Starve, Veronica, you think about it with inflation. I think what Apple just said is really telling,
 right? They said, listen, things are costing more. We have to increase prices. I mean, I've been
 coming on with you all year Morgan saying we thought inflation's broadening out. It's not just
 about services, not just about goods. They really are broadening out. That's not the end of the world.
 I mean, let's just remember, you know, we think interest rates are going to stay higher. At the start
 of this year, everybody said, how many cuts will there be? We always said, I'm not so sure. Now we're
 saying, how many hikes could there be? Once again, we're kind of taking the other side of that. We
 think the Fed will be a little bit more dovish going forward even amongst an inflationary growth
 environment with an economy that what do we've been seeing just lately, right? Manufacturing better,
 services better, everybody knows how strong earnings were. Oh, and the labor market that's
 really turning the corner. So all in all week, the Fed will be net dovish from what's expected
 right now. And that'll probably still be a positive amongst an inflationary growth environment.
 Okay. Mikey, know where we are seeing some price increases? Apple, Tim Cook making comments,
 the Wall Street Journal about this yesterday, given the surging cost of memory and some of the other
 chips that they need to make their devices. Even as President Trump is announcing that there is
 this deal to do American semiconductor manufacturing for Apple with Intel. Yeah, I mean, again,
 it's interesting. Intel's up almost 10% on this announcement. It's been reported in the past that
 they're going to do a deal with Apple. So I'd say it's probably not really new news here, but that
 just shows the froth in these markets right now. There is a lot of speculation going on. There
 is a lot of risk. And that's something you need to be cautious about, especially with the Fed,
 that's showing that there are going to be a little more conservative going forward. And it's
 not going to be an easy monetary policy environment, just for the sake of pushing financials as a tire.
 Yeah, I mean, speaking of frost, just look at the company formerly known as allbirds
 diving into AI infrastructure. Everybody's diving into AI infrastructure. But AI infrastructure is
 propelling the economy, Veronica. So how to think about that and the role that
 reindustrialization and redemesticating chip production could actually play longer term
 in the economy? Yeah, no. It is a huge driver of growth right now. If you break out the AI-related
 components of GDP, things like investment in computers, information processing, data center
 build out, that is really the main driver of GDP growth the last few quarters. I mean,
 I'd say one issue is that does mean that broader economy is very susceptible to any sentiment shift.
 And I think that's what worries me a bit. But yeah, this is a technology that's going to potentially
 be productivity enhancing longer run. Okay, we're sub-twenty seconds Ryan, final thoughts.
 Building on that GDP, the last five quarters, two percent, 45 percent of that's come from AI,
 right? We know the AI spending. We need the consumer to come back, better labor market, think it'll
 happen and thank you. All right. Thank you to our morning call crew, you guys rock. That's going
 to do it for us here.