Ending the Iran War: Market Impact 5/26/26

 Missile Strikes test optimism but futures remain higher. I'm working
 bread and and this is your morning call.
 Good Tuesday morning after a long holiday weekend here in the US. Hope you had a
 good memorial day weekend. We're taking a check on US stock futures this morning
 which are in the green with all the major averages poised for gains later this
 morning this after the Dow closed at a record high on Friday and the S&P 500 is
 coming off of an eight week wind streak all the major averages finish
 tire on Friday. We're checking energy after WTI's worst week since mid
 April watching ongoing developments around Iran we've got more on that in
 just a moment but as you could see right there a bit of a bifurcation in crude
 futures this morning with WTI crude down about three and a half percent
 trading around ninety three dollars a barrel we're down about ten eleven
 bucks from a week ago for WTI and Brent actually jumping here up about three
 and a half four percent trading just below a hundred dollars per barrel
 our bug gasoline is lower natural gas is higher taking a look at treasuries
 now to after what's been just incredible volatility in the bond market in the
 last couple of weeks you can see yields taking a little bit of a breather across
 the curve this morning the US ten year treasury yielding four point five one
 percent right now the Fed sensitive two year treasury yielding four point zero
 seven percent and the US thirty year treasury five point zero two eight
 percent if we check on metals as well we've got precious metals higher this
 morning albeit fractionally gold is basically flat here forty five hundred
 dollars and ounce but we're coming back off of back-to-back weekly losses so we
 keep an eye there meantime to a developing story and the Middle East investors
 continue to monitor the region's fragile ceasefire after U.S. forces conducted
 what U.S. Central Command described as quote defensive action in southern
 Iran including a strike on Iranian surface to air missile sites this as
 Tehran's top negotiator and its foreign minister remain in Doha for talks on a
 potential deal with Washington one the N.K. reports could include a reopening of
 the Strait of Hormuz for thirty days and Iran clearing any land mine or any
 laid minds allowing for free and safe passage once a deal is signed speaking in
 India earlier this morning Secretary of State Marco Rubio laying out U.S.
 expectations for reopening the critical waterway and odds of any near-term
 peace deal the Straits have to be open they're going to be open so I need to be
 open when it's happening there's a lot for it's illegal it's a sustainable world
 it's something there's going to be a deal we're going to have to work through
 that but this is you know it's either going to be a good deal or there isn't
 going to be one well Rubio's comments echoing what we heard from President
 Trump on social media over the long holiday weekend that negotiations are
 quote preceding nicely and that there will be a great deal or quote no deal at
 all well checking oil prices again the mood split as we just mentioned Brent
 crude moves higher following the new U.S. strikes in Iran while WTI is pulling
 back we should note the drop is from Friday's close as there was no settlement
 yesterday due to the Memorial Day holiday well let's bring in Amina Bakker head
 of Middle East and OPEC plus insights at Kepler Amina it's great to have you
 back on the show and I think we have to start right there this divergence we're
 seeing in prices and the trajectory of prices for Brent and WTI yeah Morgan I
 think the market has been kind of reacting to headlines between again a
 possible deal being imminent and then this morning we're hearing about the
 strikes that happened in Bandar Abbas and the defensive action that the U.S. Navy
 claims to have taken so the market is very much I would say split on on those
 and in reality I mean we're not seeing this settlement in tail any detail
 about how the straight is going to be open what's going to happen to the
 uranium so I think that the reality of the situation is still we're in this
 kind of gray zone the stalemate and until we have kind of definitive action
 around the the straight of her moves the unlocking of supply markets are going
 to remain quite volatile and Kepler has some of the best vessel tracking data in
 the marketplace so what are we seeing in terms of those movements what we're
 not seeing much I mean we're still seeing vessels kind of in the in the single
 digits here we've seen a number of LNG vessels originating from Qatar and and
 the UAE move out of the straight into into Asia but in terms of like a pick-up
 of traffic we're still not seeing that and for all to talk about crude oil
 prices refined product prices are really where we've seen some of the biggest
urgence this Iran war began so what is it going to take to see those actually
 arrested here when you think about all of the production that has been
 shut in and you think about infrastructure that's been damaged in the region
 and just what we've seen in crack spreads in general when it comes to refining
 capacity yeah and that's where the real shortage is and that's why I mean
 there's a lot of fear especially around diesel jet fuel all of these products
 and we are going to see a further shortage in the market and even after the
 straight is is opened we need a couple of months to get the backlog out and
 then I mean a fair assessment needs to happen of the damage and the
 facilities in the in the region here and I don't think we're going to see a
 full recovery this year whether if we're talking about crude or product it's
 going to take us easily into next year so this tightness is going to remain and
 despite the headlines you know of the imminent deal triggering some kind of
 sell-off in the short run I think in the longer term at least for this year and
 the first quarter of next year we are going to see elevated prices so hire for
 longer which has been the message throughout this conflict from so many experts
 including yourself I can the U.S. or others come in to help flex production and
 offset some of this dynamic over the longer term or even medium term well they
 have I would say the U.S. has been kind of a big winner in terms of you know
 boosting its exports the rerouting of supply into Europe so the U.S. has
 been doing that but it still doesn't fill the gap to the point where I mean
 we've been seeing these waivers for example the U.S. offering waivers on
 Russian crude to make sure that there is more supply to the market and you're
 even seeing countries like the UK not caring anymore about where they get
 the refined products from I mean if they're originating from Russian crude
 that's refined in India for example there's still opening open to to buying
 these products regardless of of the origin of the crude and this shows you the
 you know the extent of the sort of the shortage here yeah absolutely I mean
 a buck or it's great to have you on thank you for joining me to start the hour
 we've got to check on the action across Asian Europe as well the Nika
 hitting another milestone Ben Boulos is London with more on all of it hi Ben
 hey good morning and Asian equities paired some of their early gains in
 today's session amid those conflicting messages on the Iran Peace towards the
 U.S. Secretary of State Marco Rubio saying there's either going to be a good
 deal or none at all and you can see the mixed signals that the markets have
 taken from that two benchmarks two milestones to point out for you the cost
 be closing above 8000 the leader of the pack in the region but look at that
 the Nika it had crossed the 65,000 threshold but pulling back in the session
 closing a quarter of a percent down meanwhile let's have a look at the action
 here in Europe the FTSE 100 is ticking higher this morning as it comes back
 from a long weekend in London as do those of us who work here and shares on the
 continent though taking a bit of a breather after closing at a more than two
 month high in the previous session we're also keeping a close watch on the shares
 of Ferrari the luxury car maker shares are declining today after it unveiled its
 first fully electric car seemingly failed to impress investors it's called
 the luce and if you can just have a look at it Morgan it's got very sleek lines
 very clean simplistic design may be familiar well it's because Johnny I was
 involved in designing it the man behind the design of the iPad and the iPhone so
 very much the traits there yours for call 640 thousand dollars if you've got it
 all right well I think that should be your next live shot I'd like to see Ben
 Bullo's in a Ferrari designed by Johnny I've all right thank you so would I all
 right thank you Ben Bullo's a lot more to come here morning call including a
 passing grade for SpaceX's latest Starship launch ahead of its IPO plus
 and I AI warning from the Vatican as the Pope gets his say on big tech guardrails
 got a very busy hour still ahead you don't want to miss it morning call
 your back
 welcome back to morning call let's get another check on US stock futures which are
 in the green this morning with all the major averages poised for a higher open
 well yields ahead of this week's PCE inflation report are also in focus taking a
 little bit of a breather here across the curve US 10 year treasury yielding 4.5
 percent right now but still up from where we were at the start of this month and
 even just a couple days ago joining me now is Jerome Schneider head of short-term
 portfolio management at PIMCO and named an outstanding fixed income portfolio
 manager for 2026 by Morningstar and it's great to have you here on set welcome
 hey good morning good there okay what's going on the bond market you know the
 bond market is reflecting some of the changes and challenges that we've seen
 over the past few weeks one hand you've had inflationary expectations move
 higher because the energy passed through in those concerns on the other hand
 you've had a growth outlook which has been continuing to underlate and one
 hat on one factor looking really primarily by the outlook of uncertainty for
 jobs markets but at the same time a resilient consumer which is confounding to
 some people because they're starting to dip into savings and so that
 tension is obviously going to play into market sentiments we've seen in the
 equity market that's become more euphoric as capital spending has been
 fairly robust in the AI sectors the technology sectors and on the other hand
 you have a growth outlook which is really increasingly becoming
 concerning as some of the lower ends of the consumer become more under pressure
 again because the inflation outlook and because of the pressures with energy
 pricing so that's something that's going to be with us for quite some time
 and there is a high degree of confidence in some aspects of the market
 and a less convicted part of the market which is reflecting perhaps
 longer term inflationary concerns which may or may not actually be important to
 retail and institutional investors at this point in time yeah i mean you just touched on it
 right there at the at the end of what you just said and that is my next question for you
 is inflation becoming entrenched here and especially if you do a look at the longer
 longer end of the curve well it's not only a question a question for
 the investors look pulling up to the pump saying hey here's the gas prices yeah
 it's really a question for monetary policy and central bankers uh over the median term
 unfortunately or fortunately we should say in the United States we have a two-pronged
 monetary policy such as the one that focuses on growth as well as inflation and and that
 really is a good thing because we can have a more balanced conversation than the other central
 bankers on the world in Europe and Asia etc that being said that conversation is going to be a
 little bit more elongated than people think and the markets right now are perhaps operating
 with a little bit more false precision than you would expect some people are expecting rate
 hikes to come very quickly others are pushing them into the future at pymco we're sort of saying
 hey listen let's take a more gradual approach to those rate hikes and there's possibility that growth
 actually might roll over over the next year and elicit some rate cuts that really ultimately means
 that this is probably a place that we're going to be for some time and as chair wash comes and assumes
 the home of the fed we could be in a situation that there's a more balanced approach to those
 easings as well as the potential for hikes than the market expectations see right now so inflation
 will be firmly in focus without it out for all investors over the median term though yeah and of
 course to your point maybe we had the Chris Waller comments on friday that are seen as uh more
 hawkish from him versus what we've gotten more recently worst effects questions about what that
 looks like now the new fed chair who was sworn in in the oval office no less on friday i wanted to
 show you this kalshi chart here because it is talking about the number of rate cuts in 2026
 and a majority say they expect no cuts this year perhaps not surprisingly based on what you're saying
 i actually think what's kind of surprising here is how many do expect one or two cuts still in
 this market well you're dealing with the world of probability is and as a bond investor you
 have your hawkish aspects of what quantitative aspects of probability distribution you have
 but what it really means for uh an investor is there's a possibility it's relatively low that
 rate cuts are going to happen here over the course of the next year it's likely going to be
 elicited by growth concerns that emanate later on in 2026 and well no good reason because it's
 growth but the reality is there's a lot of factors and a lot of signposts on that road to that
 potential destination and that's really ultimately what we want to say in a world of inflationary
 expectations moving gradually higher and more importantly a jobs market which seems to be somewhat
 balanced but could break in either direction we need to maintain optionality in this world and that
 optionality comes from finding sources of return which are more resilient income etc and that
 really comes from the bond market and so one of the interesting aspects of what's going on right now
 is that normally in an inflationary environment we would find ourselves saying hmm bonds might be
 under pressure at this point time yes bonds are under pressure but predominantly at the longer
 end of the curve and the front end of the curve bonds are actually still producing real returns
 that are quite positive two percent real returns approximately through ten years of maturities
 meaning after inflation bond investors are still making money and so despite all these uncertainties
 despite outlooks of where profitability might be in the equity markets bond markets are actually
 quite reflecting an attractive market for an investment horizon with a high degree of certainty
 of returns at this point in time so we can sort of look through some of this
 architecture of inflation and growth concerns that investors as well central bankers might have
 and then bring it to a more rational conclusion of opportunity sets within the broader marketplace
 all right some opportunities sets right there Jerome Schneider it's great to have you on set thank you
 thank you very much from him go well straight ahead tough talk from Nvidia CEO Jensen Wong
 for one of the chip giants key partners ahead of a major conference and sticking with chip stocks
 we've got a watching a number of names in the pre-market after China's Huawei unveiled
 what it calls a chip design breakthrough that it says could hit the market in the next five years
 you can see most semi-names on the screen are higher morning call we'll be right back
 welcome back a milestone for SpaceX coming into the weekend the twelfth test flight of Starship
 which was largely a success the newest version of the giant starship rocket starship v3 launched
 Friday night about six thirty p.m. eastern from the SpaceX star base facility in south Texas it was
 a new launch pad the massive 408 foot tall rocket which is the tallest ever built flusub or
 but I'll leave it for splashing down in the Indian ocean a little over an hour after lift off
 as seen in SpaceX's prospectus a lot hinges on Starship entering service deployment of those next
 gen starling satellites AI data centers in space cargo and human missions to the moon and then
 to Mars would all requires the fully reusable starship which will bring exponentially more mass
 orbit at exponentially lower cost as SpaceX as space capitals Chad Anderson put it on this show
 last week it's the single biggest risk ahead of SpaceX's historic IPO next month so capturing
 some of that twenty eight point five trillion dollar tam as SpaceX has identified it cannot happen
 without Starship so a milestone for sure over the weekend well modular data center startup Armada
 is out with a series of big announcements recently as well revealing its raised 230 million
 dollars in fundraising in a series B round at a two billion dollar valuation also announcing
 it has signed a manufacturing deal with Johnson controls to build modular AI data centers in Arizona
 but perhaps most importantly Armada made CNBC's disruptor 50 list just last week so for more let's
 bring in Dan Wright go founder and CEO of Armada which is a member as I mentioned of this year's
 CNBC disruptor 50 list might not be the biggest news to you but exciting to see you on our list Dan
 and excited to have you on the show so welcome let's just start a little bit with what specifically
 Armada does yeah thanks Morgan thanks for having me on and just Armada is the hyper scalar for the
 edge we do modular AI factories that can be deployed anywhere with what I like to call the three S's speed
 scale and sovereignty we can deploy anywhere in the world within days scale up with demand and then
 also you get sovereignty down to the site level that's what Armada does yeah um so what's
 this 230 million dollars in new capital and a partnership with Johnson controls enable
 this is all about the second S there scaling we are scaling with our customers globally
 this is going to enable us to do continuous manufacturing of our galleons these modular AI data centers
 so that we can deploy them even faster uh to help the US win this globally I race that's going on
 right now right now what we're seeing is this massive shift from just training these large AI models
 to inference and really winning this AI race is going to be about being able to deploy these fast
 all over the world and that's what Armada does it's like AI in a box deployed extremely fast wherever
 you need it so how to think about how this fits into the broader AI data center and infrastructure
 build out right now so I'm about modular data centers as you just mentioned in a box
 meant for rugged environments can be stood up in a matter of days rather than months or years
 how how does this entire landscape I guess come together especially when hyperscalers are spending
 so much on these big centers yeah I mean we kind of flip the script Morgan so the way it has worked
 historically you had these big hyperscale data centers they would take years to build it was
 construction permits there was oftentimes a lot of delays modular has a lot of benefits if you
 think about it from a first principle standpoint energy is distributed and so if you can actually
 rather than having to have the data sailed to some far away data center have the data stay where it is
 but have the models and the infrastructure sail to the actual data wherever it is it's just much
 faster it speeds everything up and it also has less concerns around permitting construction as well
 as impact on communities yeah I think a key a key point here and you and I have known each other
 for a little while is the connectivity piece of this because you can't have these data centers
 operating in rugged environments unless you have connectivity and so I think key to all of this
 is the fact that one of your first partnerships and I think I believe if I'm not mistaken one of your
 first investors was SpaceX that starlink and the connectivity that starlink has enabled has enabled
 this company to move forward yeah we started a company a few years ago a little over three years
 ago and that was one of the big ships that we saw that connectivity was going to become ubiquitous
 and that soon you're going to have connectivity everywhere by virtue of starlink as well as
 private 5G and other technologies that's as good as having fiber in the ground and so that just
 means that you can really have data anywhere models anywhere and you can also have the infrastructure
 anywhere in order to kind of realize the value of AI and then the other thing that we saw is this
 big shift coming where you're going to want to not just have these very high powered AI models that
 all of those big hyper scale data centers are training you're going to want to be able to deploy
 them for inference at the edge on just this huge amount of data that's being generated by cameras
 and sensors and drones there and so we're enabling that shift all right Dan Wright of Armada it's
 great to have you on thank you great to see you thanks Morgan thanks for having me on
 and to see the full disruptor 50 list just scan the QR code on your screen or go to cmbc.com slash
 disruptor 50 we'll still on deck we're tracking the 3d printed home revolution growing in
 popularity for buyers not so much for lenders our Diana Ulrich shows us why that is about to change
 morning call we'll continue next
 as america celebrates its 250th anniversary cmbc spotlights the companies that rose with the nation
 and continue to shape its future
 150 years ago when aliexander grand bell came up with the first idea of a phone call he thought
 about calling the office right next door to him he never really thought about what this could be
 in terms of connecting the globe and yet today it's the foundation under which commerce
 and the economy was built that is really the origin story of AT&T maybe a small idea started
 contained but it grew incredibly big over time when you think about every innovation that's occurred
 in communications in our society whether it was analog communications with voice the advent
 of using radio frequency technology when you think about what has happened with fiber optic
 capabilities all those innovations came somewhere out of AT&T time after time AT&T has been there
 when people in the united states have needed it whether it was allowing a president to talk to
 people on the moon and it certainly has to be the most historic telephone call ever made from
 the lighthouse AT&T put the first communications satellite in space nothing was left to chance
 what we've been able to do to scale wireless technology to this very day i think everybody at AT&T
 comes up with a spirit of innovation in their own way they come in thinking about what's the next
 big idea that they can come up with to advance communication and take it a step further here we
 are today on the dawn of the AI revolution getting ready to invest even more money and create new
 capabilities that will take this economy in this country to an entirely new place
 i'm working bright and welcome back to morning call after long holiday weekend we're going to check
 getting a check on you with stock futures which are higher this morning and this after the
 Dow close friday at an all time record high and the s and p is coming off of an eight week wind
 streak with all the major averages finish higher on friday that seems poised to continue taking a
 look at oil and what we're seeing uh with energy prices this morning i can see a bit of a divergence
 here between wti and Brent wti is down about three and a half four percent right now trading around
 ninety three dollars a barrel down about ten bucks from a week ago for wti and Brent the international
 benchmark uh is up three and a half percent trading around ninety nine dollars and fifty three cents
 turning to treasuries now where we see yields uh a bit lower across the curve this morning
 if you see the us ten year treasury yielding four point five percent and if we take a look at global
 markets as well mix session in asia south kris cost be hitting a new high thanks again largely to
 the surge we continue to see in semiconductor stocks and if we get an early check on early trade
 in europe here you could see it's a mixed picture across the board germandax is down about six
 tenths of one percent checking some of the morning's latest headlines outside of the war in
 Iran we continue to monitor the situation in ukraine russia hitting keve with and surrounding areas
 over the weekend and what's being described as one of the heaviest bombardments of the city since the
 start of the four year war the latest strike saw russia launch hundreds of drones and missiles including
 a rarely fired intermediate range hypersonic missile that is capable of carrying a nuclear weapon
 although we did not see that here uh Pope Leo meantime is weighing in on the debate around AI
 speaking at the vatican over the weekend the pontiff warning a i quote threatens to normalize
 an anti-human vision adding the concentration of immense digital power in the hands of a few private
 actors is concerning the event was also attended by anthropic co-founder chris ola and speaking
 in ty one ahead of this year's computex summit in video ceo jensen wang is calling out partners
 including super micro telling them to tighten up regulation and compliance after authorities
 detained three of super micro employees for allegedly trying to smuggle AI chips into china
 you can see super micro shares are actually up a bit this morning and officials in orange
 county california say they have ruled out a worst case scenario of catastrophic explosion at a
 leaking chemical tank about 35 miles southeast of los angeles that's falling overnight operations
 though crews still face fire and spill risks authority say evacuation orders for tens of
 thousands are still in place as responders continue to monitor the gk and aerospace plant
 in garden grove and shares of frory sinking after the company unveiled its first all electric
 car with a price tag of six hundred forty thousand dollars the five cedar designed with the help
 of legendary apple engineer johnny i've can go from zero to sixty and two and a half seconds
 has a top speed of a hundred and ninety miles per hour and can go three hundred and thirty miles
 on a single charge frory ceo speaking on cmbc europe earlier this morning we invest a lot of money
 we invest the right amount of money we are focused we are disciplined we use the capex in the right
 way i think that we invest the right amount of money and this initiative this business initiative
 is in line with the profitability that we have also for other initiative in the same range so
 when we use capex and use opex we use wisely well now to the latest from the iran war in
 middle east investors are tracking the fragile ceasefire after us forces conducted strikes in
 southern iran yesterday and what us sent calm is describing as quote defensive action
 including a strike on iranian surface to air missile sites well this as iran's foreign
 minister and top negotiator are in doha where for talks with cattars prime minister on a potential
 deal with washington to end this war the nek reporting an agreement could include re-opening
 of the straight for most for thirty days and iran could clear any minds that it has laid
 allowing for free and safe passage once a deal is signed well speaking in india earlier today
 us secretary state marco rubio says negotiations with iran could take a few days describing the new
 u.s strikes rubio says the straight has to be open quote one way or another well joining me now
 is peter bookvar c.i.o. at one point bfg wealth partners in a cmbc contributor and tenrietta
 trays co-founder and director of economic policy and beta partners it's great to have you both
 here peter uranset i'm going to kick this off with you could we get some sort of extended ceasefire
 beginning of a resolution to this war and if so what does it mean for markets that are already
 trading your record highs well markets i think have been rallying since early april in anticipation
 of a deal that we obviously have not gotten yet i think the iranium situation is the sticking point
 i mean we want if if we did this we did this to prevent iran from building a nuclear weapon
 and we want their iranium and iran doesn't want to give it to us to me that's the the sticking
 point on the other hand of course we want the straight to reopen because we have to deal with
 the reality of higher commodity prices higher gasoline prices particularly ahead of november
 so unfortunately the us is negotiating from a standpoint of having to pay attention to politics
 where iran obviously doesn't have to do that yeah henrietta want to get your thoughts on this
 especially as we're coming off of memorial day weekend which tends to be a big driving weekend
 and we do have gas prices at multi-year highs right now we have congress out this week but certainly
 a focus on how all of this is going to ultimately be resolved yeah peter makes some great points
 i think it's really helpful to look at the congressional calendar what happened
 late last week is that senate republicans and house republicans got very close to revolting
 against the president thus limiting his time horizon for negotiating a peace deal
 based off of the current calendar that they're working with effectively president trump has until
 June 2nd maybe June 3rd to get this resolved and while that sounds like a whole lot of time you
 know it's the rest of this week effectively we've already been in the ceasefire situation dealing with
 treasury secretary bessons operation economic fury that has not yet worked for almost 50 days so the
 window that the president has is much shorter than arons window and i think it's obvious that they
 know that and the democratic elections that we have are a disadvantage as peter rightly points out
 that's what we're working with so June 2nd June 3rd is really the president's deadline for this
 before congress starts to rain him in specifically the republicans in the house in the senate
 yeah i mean and that's certainly what to focus on here in the near term over the longer term
 i mean you put a note out yesterday the hormones hangover what are we talking about in terms of
 damages here henry at it and what does this mean for a rebuilding process and globally for prices
 well like any good norlini and i have had hangover and i think there's two parts there's a physical
 component that we're dealing with where the the straight is closed you know we're down 103
 ships a day on average as of right now so the commodity price spikes that you're seeing across
 fertilizer urea crude jet fuel all that stuff is very normal that's the physical part that's the
 headache that's fine it's the existential dread of oh my gosh what did i do that really is going
 to be the problem that keeps us in a situation where inflation is higher for longer interest rates are
 higher for longer because now we've opened pandora's backs we got in touch with the ir gc we
 gave them control of the straight they're going to charge some sort of environmental fee or
 service fee or maritime fee whatever they want to call it the u.s ambassador to israel said
 a toll by any other name is still just as expensive and that's exactly correct that is the
 ramification of what we have done by invading Iran by launching military weapons across Iran
 is now they have control the straight and that is the ramification of our night out all right
 what's like a description of a hangover not for nothing henry had a trace thank you peter we're
 going to see you again in just a bit for morning call crew you're to do double duty for us today
 so we're going to dig into what all this means for inflation and also that a i trade and how that
 you know buoys us here if it does coming up so peter will see you hang tight and as i mentioned
 there's more to come here on morning call getting you to a buy a 3d printed home Diana
 Oleg is here with exclusive details on the banking giant offering fresh incentives to do just
 that and as we head to break the party is still likely going in the streets of new york city after
 the nicks advanced to the NBA finals after sweeping the Cleveland Cavaliers in the eastern conference
 finals with a dominant 130 to 93 win in game four and marks new york's first trip to the finals
 since 1999 new york will face either Oklahoma city or san antonio when the finals begin next week
 big news here in the new york metro area morning call right back
 welcome back 3d printed homes are slowly becoming more mainstream but it's still pretty hard to get
 a traditional mortgage for one that's about to change Diana Oleg is here to explain in this week's
 property play hi die hey good morning Morgan yeah Wells Fargo is announcing right here on CNBC that
 is is jumping into 3d in a big way now we took you to this 3d printed community last year just
 outside austin texas it's a collaboration between lanar and icon the nation's largest 3d developer
 lanar mortgage did most of the financing on those homes well now Wells Fargo will be icons preferred
 lender for other 3d printed homes and will also offer an incentive to buyers of 50 basis point
 lender credit to buyers of icon homes using Wells Fargo mortgages
 having a one of the big banking players make such a strong and pointed announcement that we like
 these houses we're excited about these houses in fact we're going to give preferential treatment
 to these houses i think helps people just in a in a broadway who don't track the minutia
 of the housing mortgage industry now it was tough to get a mortgage before because there had been
 concerns among lenders over the viability of the technology the potential appreciation of the
 homes and the ability to both sell and ensure the loans we don't have any reason to believe that
 the long term value for these homes will be in a different form homes that are built based on
 traditional construction technologies icon is also announcing it's starting to sell its new
 Titan 3d printers to other developers the price tag $899,000 Wells Fargo will offer financing to
 builders interested in buying the printers as well as mortgages on the homes built with the icon
 printer that is signaling institutional confidence in alternative construction now for much more on
 this and many other stories the property play newsletter drops in a couple of hours go to it if
 you haven't signed up it's free cnbc.com forward slash property play morgan
 Diana for folks that maybe don't know space it's actually one of the early pioneers of 3d
 printing in aerospace but when we're talking about 3d printing in home construction are there any
 concerns or maybe even a connotation of concerns are around quality control or do they tend to be
 just as good if not better than traditionally built homes well if you're icon you would argue
 that they're actually better they're built faster you know and we went out to that community in
 Texas they were using literally three people to build or spit out in the in the concrete these 3d
 printed homes and they were doing it faster they were doing it cheaper and it's much more
 environmentally efficient for cooling for heating and for just in general building because you don't
 use as much equipment to build these homes so they would argue yes they're much better and you know
 they've got one Lauren Lennar community already done another is in the works if they sell these
 printers to others they're going to start to see many more communities so the technology is quite
 viable super cool Diana Oleg thank you and check out property play well straight ahead the morning
 call crew cheating up the trading day ahead Iran sees fire uncertainty doing little to dent investor
 enthusiasm this morning and then you've got the AI trade on the other side of this racing for its next
 test we've got more earnings this week we're back in a moment it's time now for your call sheet
 where we look at the topics driving the trading day ahead crew members today Peter bookvar 1.bfg
 wealth partners is back with us also joining us Ryan Dietrich Carson group Peter and Reiner both
 CMBC contributors and Amy Wu Silverman of RBC capital it's great to have you all here Peter
 I'm going to kick this off with you and I'm going to pick up on what we were talking about with Henry
 Dietrich is just a short while ago and that is Iran peace push and specifically what we've
 seen there's a cool chart from Ben Emman's friend of the show if we could pull that up but we've
 seen the inverse relationship between Brent prices and the number of times war and soon is mentioned
 by the president or the administration so how does that set us up for this moment right now
 I'm hoping this one is for real and we do get a resolution to this I don't think either
 side's going to get exactly what they want but the inflation is the global pain point and we
 need some relief we need some relief at the palm and I think this is what's going to get us there
 I think it's still going to take time for the trade to fully reopen for supply chain to normalize
 but we need to take this big step to get there first yeah Amy what's the options market signaling
 about all of this you know it's been fascinating because the options market this entire time has
 been overwhelmingly exuberant we've seen historic levels of call buying and really despite everything
 that has been going on geopolitically with the straight-of-war moves with the impact we know will
 happen down the line there's been very little downside protection put in place and very little
 hedging yeah Ryan want to get your thoughts on this especially because it does seem like there have
 been two sort of big tent poles that are moving the market one way or another on a daily basis
 there's a run conflict being one and AI being the other
 you're right good morning everybody hope everyone had a nice Memorial Day weekend and thanks
 for everyone who keeps a safe out there so you guys had a great conversation before I came on let's
 build on some of these things here we know tech is leading right we know that but I think it's
 fascinating most people might not realize Morgan if you look year to date six sectors are actually
 outperforming the S&P 500 just last week the S&P 500 equal weight hit an all-time high of course the
 Dow finally got back above 20,000 I'm sorry 50,000 and you think about it I mean this is not just a
 this is a broad market right we keep here I keep here now it's only tech going up yes tech is
 up more than most things but it really is Morgan a broad market and we think that's pretty healthy
 for a continuation of this rally yeah meantime Peter I mean inflation front and center in this
 market as well and we've seen those dryrations playing out in the bond market too we had services
 inflation that was elevated and sticky ahead of this conflict now we've hardly seen the knock-on
 effects of energy price spikes as well and then of course we're talking about this with a guess
 earlier in the hour from PIMCO even if you get a conflict resolution here in the near term the
 strength of this AI infrastructure build out could also mean very strong growth and could also
 keep inflation stickier so how do you navigate it I think it's that and I think commodities
 generally going to have a bid I mean for the next year or two you can just imagine the amount of
 stockpiling the strategic reserves that are going to be created for more than just crude oil but
 for a variety of different commodities and I think supply chains are not going to be quick enough
 to catch up when things normalize so to me commodity prices are in a bull market commodity stocks
 are in a bull market and that's going to complicate the inflation story for the incoming chair
 and it's keep in going to keep at least the longer interest rates still elevated and I still
 risks for them to move even higher after this recent move higher yeah Amy I want to throw up a chart
 from Kalshi here and it basically is how high will the S&P get by month end which keep in mind
 a couple days from now right end of the week but 68 percent think we're going to end the month
 of May above 75 50 for the S&P 49 percent above 75 75 and 29 percent above 7600 I mean it really
 speaks to perhaps as you just mentioned the bullishness that we see in this market
 for sure and I can tell you that when we look at option tenors maybe through your end
 the bets that are similar saying that we will be over 8,000 8500 look somewhat similar to that as
 well I think it really speaks to the momentum in the market and one thing we've learned over time
 if you just think about April 2nd of last year the drawdown we had but the whip lash back up
 there's a lot of fear of the right tail Morgan there's fear of missing out and there's fear of
 being caught off-size not necessarily on the downside but on the upside that you then have to explain
 to your investors if you are a fund who didn't get that upside and didn't get that right tail yeah
 Ryan I want to go back something you just said and that that is the broad-based nature of this rally
 that we're seeing particularly with you know equate S&P at a record last week down at a record last
 week where do we go from here I ask that question but I'm asking you because so much of the narrative
 this week other than Iran is going to be around whether this tech trade can continue when you look
 at some of the names that are going to report earnings well I want to build up I want to build
 something that Peter just said here we have a new fed leadership right we know that and when you
 look at history and a lot of people talked about this I just dug in though last 100 years within
 the first three months you have as much as a 12% on average peak to trough correction do markets
 truly test new fed share persons listen the last three they really didn't but history says
 you could so let's just be aware of that after an eight week rally up 17% the second best eight
 week rally in history maybe you get a little test and where's it going to come from like Peter just
 said higher commodity prices potentially higher yields that's a big theme we've been saying all year
 a Carson group inflationary growth we're not super worried about inflation running 3 3 and a half
 percent we've said it probably would this year yes commodities are in a bull market but we still
 think it's a equity bull market now specifically answer your question I think you stick with
 the cyclicals I mean tech is way up there we get it but industrials financials are the worst
 performing group I think they're going to have a big second half as cyclicals kind of continue
 to take this baton here Morgan all right Peter we've got less than a minute here final thoughts
 I think it's a tricky moment because the AI dominance has sort of pushed aside other things
 if you look at retail earnings last week comments from Wal-Mart where they said for the first
 time since 2022 that the average person is filling up less than 10 gallons it tells you that
 there's still this very stressed consumer that needs relief on the inflation side and why it's
 so important for the straight to reopen and supply chains to begin to normalize again all right
 well we're going to leave it there our thanks to our morning call crew great to have all of you
 here to set up a holiday shortened week but what's sure to be a busy one you can see us stock
 futures are higher this morning right now with WTI under pressure but Brent moving higher as well
 amid focus on Iran's squat box starts right now