Hantavirus Fears, Transports Pressured By Fuel Costs 5/12/26

 Trump heads to China, but
 inflation grabs a spotlight,
 at least today, stocks and
 weight and sea mode.
 I'm Morgan Brennan,
 and this is your morning call.
 Good morning,
 let's get a check on you
 with stock futures with a
 Nasdaq and the S&P 500
 sitting at all time highs
 as of the close yesterday
 you could see under a bit of
 pressure this morning with all
 of the major averages poised
 for a lower open a bit later
 this morning.
 Let's get a look at
 treasuries as well ahead of
 today's key April CPI
 inflation report.
 You could see yields are higher
 across the curve,
 US 10-year treasurer yielding
 4.431% right now.
 And let's take a check on
 metals too,
 because gold and silver
 under a bit of pressure.
 Again this morning,
 but we're keeping a
 close eye on copper,
 which is up about half a
 percent right now.
 Those futures after closing
 at record highs yesterday,
 we've seen such a rebound
 in Dr. Copper in recent
 trading sessions.
 Let's also check on energy
 here as we see crude prices
 moving higher with WTI
 crude up 3% right now back
 above $101 per barrel
 and Brent up 2.5%
 just below $107 per barrel
 and our about gasoline
 and that gas also in the
 green.
 In video,
 let's look at that too.
 That's lower this morning
 after closing up another 2%
 yesterday.
 The stock is writing its
 strongest four-session run
 of the year adding more
 than $590 billion in market
 value over that four-day
 stretch.
 You heard that right.
 That's more than the total
 market value of Oracle,
 down about 1% this morning.
 We're also watching the
 overnight action in Asia,
 mostly red arrows
 across the board.
 South Korea's
 Cosby, which has just been
 on fire,
 taking a breather this morning,
 closing down more than 2%
 this morning.
 The knee-k,
 as you can see on your
 screen right there,
 the lone market
 finishing higher up
 about half a percent.
 Investors highlighting new
 concerns of regional
 concentration risk among
 just three names,
 Taiwan,
 SEME,
 Samsung Electronics,
 and SK high-necks,
 and accounting for
 between 42%
 of the entire
 Korea benchmarks indexes
 and their
 recent monster rallies.
 Over in Europe,
 the trading day just
 getting underway
 as we track political
 turmoil in the UK.
 Karen Cho
 is in London and
 she has the latest there.
 Karen.
 Morgan,
 good morning to you.
 Well, European equity markets
 are lower in early trade,
 as hopes for US
 Iran, peace deal fade.
 After President Trump said
 the ceasefire was on
 life support,
 we are asking a reversal
 across on German stocks
 and on Italy down
 roughly 19th of a percent,
 selling in
 carriers from retail
 to autos.
 But also a big focus
 on the banks,
 and we are saying a
 backlash there,
 thanks to the UK
 political situation.
 And whether the
 Prime Minister has
 not innings as a leader here,
 secure
 Starmer has told his
 cabinet he's going
 nowhere.
 It comes as his position
 as Prime Minister comes
 under increasing pressure,
 at least one minister,
 and several ministerial
 aides have resigned
 from Starmer's government,
 and more than 70
 of his own MPs have told him
 to quit.
 With the Prime
 Ministers make or break
 speech yesterday morning,
 failing to quell a
 growing rebellion.
 We are seeing a
 rebellion too on the
 bond market,
 with Marched-Opt 2
 levels, not since
 1998.
 At the long end of the
 curve, the 30-year
 guilt, as you can see,
 5.79%
 were also rallied
 on the 10-year year,
 that is much tie by
 about 2.5%.
 Now perched at 5.1%.
 And keep in mind,
 we started out the year
 around 4.5%.
 On the 10-year, so it's
 telling you about the
 political risk that is now
 becoming baked into
 the situation.
 But the fragmentation
 of politics, things to
 a local election result,
 the other week, now
 manifesting itself
 in some sort of a
 force to remove the
 Prime Minister from
 the 10-dong street,
 Morgan back to you.
 All right, Karen,
 thank you.
 We talk about geopolitical
 risk in some of these major
 markets, whether it's the
 U.S. or the U.K. or elsewhere.
 But the political risk, too,
 as it's playing out in
 things like the bond markets.
 Karen, Chale, thank you.
 We're sticking with the
 action overseas, and major
 market focus this week.
 President Trump's
 high stakes face-to-face
 with China's Xi Jinping,
 that starts on Thursday
 alongside a coalition of
 major U.S.
 CEOs, everyone from Tesla
 to Apple, BlackRock,
 Boeing, quite a list
 coming together.
 Let's get to Unisune
 in Beijing with the latest
 UNICE.
 Thanks, Morgan.
 Well, China is on a charm
 offensive, playing up U.S.
 business ties ahead of
 President Trump's visit
 here.
 The foreign ministry today
 put out a video that
 highlighted the importance of
 Apple and Tesla among
 other companies.
 Now, those two companies
 are on the invite list for
 CEOs that will be potentially
 joining President Trump on
 his trip to China.
 The list features companies
 that have benefited greatly
 from this relationship,
 like Apple as well as
 Tesla, but also those that
 have suffered because of
 the competition as well as
 the deterioration in
 ties, micron and
 alumina.
 For example, both of them
 targets at one point of
 retaliation.
 Visa and city historically
 blocked or restricted for
 market access.
 A Qualcomm is the latest
 company to confirm its
 participation.
 Cisco says that it won't
 join.
 In video was not on the list.
 Now, the primary focus of
 the talks is still
 expected to be purchases.
 So, bowings, for example,
 or soybeans, energy, those
 are all being discussed at
 this point.
 But what isn't so clear is
 whether or not some of the
 other issues that the
 business community is
 worried about, the U.S.
 business community is
 worried about, if those are
 going to be addressed.
 For example, on the eve of
 this very important visit, the
 U.S. Chamber of Commerce
 put out a report that focuses
 on China's industrial
 system.
 What they call China's
 industrial policy of
 everything and that's China
 attempting to embed
 itself in global supply
 chains and to the detriment
 of industries back home.
 Morgan.
 I also want to just ask you
 about Taiwan arms sales
 because when the President
 was President Trump was
 asked about Washington's
 longstanding support for
 Taiwan's defense last night.
 He said he's going to
 have that discussion with
 President Xi.
 And basically, the
 longstanding support of
 the U.S.
 company and basically saying
 that that was on the table.
 We know it's records
 sums that have been approved
 to be sold to Taiwan,
 even though that
 backlog is longstanding
 here.
 Any sort of sense on what
 that role that could play
 in the summit here and what
 that would mean with the
 political, you know, the
 ramifications can mean, especially
 you see the U.S.
 rhetoric softening.
 Yeah, well, in terms of
 the redics softening, well,
 the first of all, I was
 going to just tell you that the
 foreign ministry actually
 responded quite quickly as
 you would expect from the
 Chinese to the comment that
 President Trump had made
 saying that their position
 is very crystal clear.
 And over and over,
 we've been hearing from the
 Chinese that they do not,
 but their red line is Taiwan.
 They want to make sure that
 those arms sales do not
 happen.
 You had mentioned that record
 number anywhere between
 like $11 to $14 billion.
 So the Chinese have said
 that they do not want to see
 that happen.
 In terms of what the Chinese
 have also are expected to do,
 it's not only pushed for the end
 of those arms sales, but also
 for a softening of the U.S.
 stance.
 So actually changing
 language from not supporting
 Taiwan independence to outright
 opposing independence.
 So still unclear whether or
 not President Trump or the
 Trump administration would be
 willing to do that make those
 changes.
 All right.
 Unisun, great to see you and
 have you on to set this up
 and what's sure to be a busy
 next couple of days.
 Well, against the backdrop of the
 Trump she summit.
 The Iran War, a market that's
 been largely supported by strong
 earnings, AI, the chips in
 particular.
 Investors could get a real test
 today with a fresh read on
 inflation.
 Consumer prices are likely
 to have risen at a solid pace
 for the second straight month
 in April, with gas prices
 accounting for the most of the
 expected year-over-year increase
 at 3.7%.
 That's top line for CPI.
 On Kalshi, a majority expecting
 that year-over-year read to
 come in at 3.6% or higher.
 And joining me now on set is
 Victoria Fernandez, chief
 market strategist across
 market global investments.
 It's great to have you here.
 Welcome.
 My pleasure.
 I mean, there's so much for
 investors to digest here.
 I think we just have to start
 with what Eunice was talking
 about.
 What is priced into this market
 regarding this Trump she summit?
 I'm not sure there's too much
 priced in and I don't think
 there's a lot of expectations
 actually that we're going to get
 a lot coming out of this.
 I think people say there's not
 going to be a lot of practical
 elements coming out of it.
 They'll be talked.
 There'll be some headlines.
 There'll be more discussions
 to follow.
 But I don't think we're going to
 have big market movers coming
 out of this.
 Unless the whole group of CEOs
 that are going actually have
 some kind of news.
 They're signing deals.
 They're promising things.
 And there's a change in regards
 to tech distribution to China
 out of the U.S.
 That could be maybe
 the largest headline that we see.
 Yeah.
 I mean, it's certainly interesting
 in regards to that.
 It almost seems like
 not fighting or continuing to
 extend a day-ton is news in
 of itself or good news for the
 market where China relations
 are concerned.
 So let's talk a little bit
 about tech because this is a
 market that seems to be as you
 put it in your notes operating
 on two different economies
 simultaneously.
 It seems like we have our
 AI economy and everything
 associated with that.
 You talked about earnings.
 Earnings are supporting the
 AI story, the cat-backs.
 I mean, $700 billion this year,
 a trillion next year.
 We're going to, that's over
 3% of GDP.
 Strictly from these AI
 companies.
 And we know that there are
 majority of the dollar
 increase that we're seeing
 in earnings growth.
 And then you have this other
 economy that's what is the
 labor market doing.
 Inflation numbers, obviously
 CPI later today,
 PPI tomorrow, the consumer
 retail sales on Thursday.
 It's almost like we're
 operating in two different
 segments where AI is
 really what is giving any
 kind of positive news
 for this economy.
 But outside of that,
 there's a lot of cautiousness.
 How much does inflation
 reading CPI today,
 PPI later in the week?
 How much does this matter to a
 market that's trading at record
 highs?
 I think it matters to the Fed
 quite a bit, right?
 They're having to make the
 decision as to, are we seeing
 those second-order effects
 coming from inflation?
 Are we going to see something
 more than just oil and gas
 moving higher?
 And therefore, they're
 going to continue to look
 through it.
 Does it flow through to
 wages, right?
 Do we get that second-order
 effect coming and inflation
 expectations move higher?
 If we do, then I think the
 market reacts because the
 market says, oh, wait a minute.
 Now, we might be moving closer
 to a Fed hike instead of
 staying at pause or even a cut
 later this year.
 Yeah.
 Semis have been on just a
 torrid rally.
 Does that continue?
 Or do you position yourself
 into other parts of the market
 right now?
 Well, I do think you need to
 be in other parts of the market.
 And I think you protect
 yourself in semis.
 Are we in a bubble in semis?
 A lot of people are saying we
 are.
 I mean, yesterday on this
 network, I think there were
 about three people that came
 and said, you need to sell
 semis or even short semis.
 I think that's a little strong.
 I would trim a little bit.
 Protect yourself in that area.
 You've got a sector that's 50%
 over its 200 day moving average.
 So, trim back a little bit.
 And yes, there are other
 areas in the market you can go
 to, even things like
 agriculture.
 That's an area that we've been
 going into a little bit
 recently as well because of the
 issues that we've been seeing in
 the Middle East.
 You're seeing a lot of promise
 there.
 Yeah, it does seem like soft
 commodities are starting to catch
 a bit.
 They had been lagging
 everything else.
 And the super cycle that
 we've been seeing take root
 here, even before the war.
 Yeah.
 It's great to have you on set.
 Thank you so much for joining me.
 Thanks for having me.
 Victoria Fernandez.
 Well, we got a lot more to come
 here on Morning Call, including.
 Why shares in Moderna getting
 some tension amid the
 handsome virus outbreak?
 Plus, Kevin Warsh.
 Clear is a key Senate hurdle on
 his way to becoming the next chair
 of the Federal Reserve.
 And later, Home Builder
 M&A drama.
 As mortgage rates hover
 near their highest level since
 October, we have a very, very
 busy hour still ahead.
 You don't want to miss it.
 Morning Call, be right back.
 Thanks, you all.
 Welcome back to morning call
 watching shares in Moderna.
 This rub doubled digits
 over the past five trading days
 as the public was increasingly
 concerned about this
 cruise ship, Hanta virus outbreak
 outbreak and the dinner is possible role in a possible vaccine.
 The company says it's been studying the virus for years along with U.S. Army and Korea University
 College of Medicine that those efforts are still in quote early stages.
 Shares are up nonetheless right now this morning about 2.5% pre-market.
 So on set with me now to break all this down is Eneka Kim, Constantino.
 It's great to have you here.
 Welcome.
 Welcome.
 Thanks, Morgan.
 What are we talking about with the potential for a Moderna vaccine, especially if they
 have been studying this for several years now?
 That's right.
 So right now, there's no treatment or specific drugs, specifically for antivirus.
 And so the usual intervention is what we call supportive care.
 And that's treating the symptoms of the virus, such as putting a patient on an
 ventilator, for example, because antivirus can cause syndromes that affect the lung or
 the kidneys.
 But as you said, Moderna has been working on this since 2023 here.
 But the downside of this is that it's pre-clinical right now.
 It is not being tested in humans yet.
 And so that likely means that it's going to take years for it to reach any kind of person
 right now.
 Yeah.
 I mean, antivirus has been in the news.
 We have this cruise ship now and the fallout from that situation.
 Obviously, last year, very high profile deaths associated with the passing of Gene Hackman and
 his wife as well.
 But how big is the actual marketplace for something like antivirus?
 We haven't really heard about it or talked about it very much.
 Publicly at least, I haven't noticed it in a mainstream way until more recently.
 Right.
 This does happen in the US and the specific strain that we're seeing now, this Andy strain,
 is only really found in South America and you only get a few hundreds of cases there as
 well as what you see in the US as well, the other kind of strain of this virus.
 You're not seeing a lot of cases.
 It's not in the thousands of numbers here.
 And so this sort of Moderna vaccine, there is an opportunity there to treat those patients
 that we do see the dozens of patients that we see a year.
 But it wouldn't say it's a large scale marker opportunity for Moderna here.
 Yeah.
 On the screen right now, tracking antivirus, 18 passengers return to the US and being
 quarantined and tracked right now.
 But in general, what has been the response to the response by the US government around
 all of this?
 That's right.
 So when I talked to health experts, they did sort of express concerns about the CDC's
 response here and the sort of the lack of a more robust response.
 And so when I talked to Georgetown's Lawrence Gosson, for example, he said that the CDC has
 been slower to act here relative to its European counterpart as well as the World Health Organization
 saying that the CDC was sort of later to deploy a team out to the Canary Islands, and also
 later to have a media briefing or even issue a public health alert on its website.
 And so historically, the CDC has really been this crown jewel in terms of monitoring and
 tracking a disease outbreak from the get-go.
 And so we said it is kind of raising concerns about, if not antivirus, what happens for
 the next COVID or a new virus that we haven't really dealt with before?
 All right.
 In light of all of this, where do we stand with the vaccine market overall?
 That's right.
 The vaccine market, there are concerns about what the government is doing in terms of changing
 vaccine policy.
 That's being challenged in court right now and the changes that we're seeing to the childhood
 vaccination schedule.
 But that is that the government has appealed that.
 So we're going to see how that kind of plays out.
 But at this point, there are concerns about how that's going to kind of affect vaccination
 uptake here in the U.S.
 Okay.
 Annika, it's great to have you on set.
 Thank you for joining me.
 Thank you.
 Well, straight ahead, we're following strategy strategy.
 Another crypto pivot with prices stuck in a holding pattern.
 But first, watching shares of hymns and hers health, those shares are following after
 the company issued worse than expected earnings guidance for its current quarter on GLP1 market
 weakness.
 Pull your sales outlook, though, that came in higher as did the current quarter sales
 outlook.
 Company is exploring new revenue opportunities.
 Morning call.
 It's back after this.
 We're down about 15%.
 You know, we have a lot of fun here on set every morning.
 Welcome back to morning call.
 Let's get a market flash on GitLab.
 It's down about 7% right now.
 Shares are lower after the company's CEO outlined a broad restructuring plan that has tied
 to the software company's move into agent AI.
 This includes reducing the size of its workforce, including cuts and management, also reducing
 the number of countries that it operates in by up to 30%.
 She get more details with earnings which drop early next month, we could see shares right
 now under pressure.
 We're also watching shares of beta technologies.
 That's out with earnings this morning, posting a smaller than expected loss revenue also
 beating the street.
 And for more, we are joined in a CNBC exclusive by beta founder and CEO Kyle Clark.
 Kyle, welcome back to the show.
 It is great to have you.
 Let's talk about the quarter.
 What did you see and how does it set you up for the rest of the year?
 Well, good morning, Morgan.
 The quarter was great.
 We realized massive thematic tailwinds from the administration and with the military,
 with the launch of the CV toll integration pilot program, really allows us to start
 four revenue operations in cargo and logistics earlier than we all expected and directly aligned
 with beta strategy of medical first, then cargo and logistics before passenger, which really
 opens the gates for the whole industry, but specifically beta.
 It's been a good quarter on the strategy side.
 Yeah, it's interesting to hear you say that how quickly can you start to ramp some of
 these flights then, especially as Joby and Archer Aviation are poised to begin some sort
 of passenger service before the end of the year.
 Yeah, we're going to be starting also before the end of the year, but we actually won seven
 out of the eight EV toll integration pilot programs and that's a big deal for beta because
 we're starting actual operations of moving cargo, logistics, medical supplies.
 We're not just doing demonstrations and that allows us to get high cadence operations
 that really expose the benefits of low cost electric aviation.
 So before the end of the year is the answer your questions well.
 And some of this is dependent on the negotiations with the FAA and the Department of Transportation
 to finalize the operational limitations.
 Okay.
 In terms of manufacturing, how is that process going, especially as I know you're also developing
 multiple aircraft and propulsion systems, including with GE and you inked a deal with general
 dynamics as well.
 Yeah, absolutely.
 Our manufacturing is going very well.
 We make our own motors, batteries and verters.
 We've been selling those to the companies you mentioned, including general dynamics and
 rare and that's going extremely well.
 Our aircraft, we met our first quarter goals on production.
 We're on track to hit our rate goals by the end of the year here, which is four and a half
 units per month.
 It's a slow start in a highly regulated industry where the FAA is a part of all of our
 build processes as we as a new applicant work through our manufacturing ramp.
 But it's going extremely well on the civil side.
 We also pulled forward our defense strategy by about six months, again, in partnership
 with GE on the Turbo Generator to launch our MV250 program, which is also in that low-rate
 initial prototype production phase.
 Yeah.
 Speaking of GE, the CEO Larry Colp, I think is expected to be one of the CEOs that makes
 this trip with President Trump to China for this summit later this week.
 We just talked about the U.S. and the U.S. market that's materializing.
 But how do you see the rest of the world's materializing as well?
 Yeah.
 So, over the last couple of years, we've been flying in Norway and New Zealand.
 We just got out of an operation in Japan.
 We're actually bringing back a lot of focus domestically with the opening of the floodgates
 of the EIPP program.
 So we have all the aircraft we need to launch that later this year.
 So those aircraft are all coming back to the U.S. ironically.
 If you asked me that same question a year ago, I would say would be launching international
 before we start launching domestically.
 But the field has changed with this new program.
 And that obviously makes us very excited to do this domestically.
 That's super interesting.
 Finally, I just, I want to get your thoughts on what we're seeing.
 I mean, we've got this war in the Middle East and the impact radiating out through the
 region.
 I've had so many conversations over the years about how on the forefront, some of these
 Gulf countries have been in terms of EV tall adoption.
 Yeah.
 I mean, they're progressing on all technology integration.
 But, you know, one of the things we, like you said, we beat our quarter revenue.
 But one of the things that is buried within theirs, we actually halted the installation
 of our chargers in the Abu Dhabi airports.
 And we more than made up for it in motor sales domestically.
 So it has affected our business, not in aggregate, but in isolated places.
 So the ebbs and flows internationally are quite complex to manage.
 But the good thing is we have a good diversity of products and a good diversity of types of aircraft.
 And we were able to cover that.
 What we're seeing across the entire world is that the U.S. is really starting to establish
 its leadership position in aerospace.
 We've got a little behind over the last few years.
 And that's accelerating forward relative to the Middle East, Europe, and Asia.
 Okay.
 Kyle Clark of Beta Technologies.
 Great to have you on.
 Thank you for joining me.
 Good to see you.
 Good to see you too.
 Well, still on deck.
 We're sticking with transportation here.
 Roadblocks removed.
 We dig into the fundamentals for the transport sector and specifically freight flows.
 And what those are showing in terms of the state of the U.S. economy.
 But first, small but important, watching shares of Bees or Homes after a more than 30
 4% pop yesterday, you can see it's down about 2.5% right now pre-market.
 It's less than a billion dollar market cap.
 It's lower after rejecting Dreamfinders' Homes $25.75 per share takeover offer, saying
 that proposals represent a significant discount to book value.
 Morning, Kyle.
 We'll be right back.
 As our country celebrates its 250th anniversary, CNBC spotlights the leaders driving business
 and the nation forward.
 I'm Tim Walls, chair and CEO of KPMG U.S. KPMG has been part of the American history
 for 130 years.
 If I think back to 19.0 tool and the coal strike, Theodore Roosevelt called on KPMG to
 come in and help solve that crisis.
 19.07 JP Morgan himself during the financial crisis of 19.07 called on KPMG to ease markets.
 In 1914, our firm was there to help establish the Federal Reserve, and then if I think to
 World War II, helping President Franklin Roosevelt administer the Lendley's program as part
 of the war.
 Today, KPMG serves thousands of clients here in the United States.
 We started with pencils and paper and doing our work in ledgers, using devices that
 even predated the calculator.
 I think forward to the computer and now AI, I mean the journey has been incredible, and
 I'm so excited about the journey that's yet ahead.
 Over not only America's 250 years, but our next 130, America's superpower, his opportunity,
 my grandfather was a coal miner, and he died with my mom with seven years old from working
 in the mines, and my grandmother then went to work in a silk mill as a seamstress.
 She did that year-in and year-out until my mom got through high school.
 And somehow she got my mom to college.
 My mom became a microbiologist.
 She married my dad, who was a school teacher, and here I am one generation later.
 As a chair and CEO of KPMG, that's what opportunity is, that's what America is about.
 I'm Morgan Brennan, welcome back to Morning Call.
 Let's get a check on US Stock Futures, which are lower this morning.
 You can see all the major averages poised to open in the red.
 As the S&P and NASDAQ sit at all-time highs, with the S&P yesterday closing above 7,400
 for the first time, we're keeping an eye on the Equal Weight S&P 500, as well as trailing
 the benchmark-capuated S&P 500 over the past month.
 Take a look at that chart right there.
 It's been a big bifurcation, Equal Weight, still nearly 1% away from a record high, as
 well, though, but this really speaks to how tech has been leading the charge.
 Treasuries ahead of today's April CPI inflation report are higher across the curve.
 US 10-year treasury yielding 4.431% right now.
 Similar situation for energy is crude prices tick higher.
 You can see right there, WTI is up a little over 3% right now trading around $101 per barrel,
 and Brent Crude is sitting just below $107 per barrel.
 In video, we're keeping an eye there too.
 Those shares are lower this morning pre-market, for actually about half a percent after closing
 up another 2% yesterday.
 The stock is riding its strongest four-session run of the year, adding more than get this $590
 billion in market cap over that stretch.
 That is more than the total market value of Oracle.
 Well, checking some of this morning's latest headlines, Reuters reporting that China's
 vice premier has landed in South Korea for trade talks with Treasury Secretary Scott
 Bessent.
 That is ahead of Thursday's Trump-She face-to-face.
 Bessent currently wrapping up high-level talks in Japan with the Japanese Prime Minister.
 The Senate has expected meantime to vote as early as today to confirm Kevin Warsh for
 a 14-year term as a Federal Reserve governor, followed by a vote tomorrow for his four-year
 term as Chairman.
 This after Warsh cleared a key procedural hurdle yesterday.
 J. Powell's term as Fed Chair is set to end on Friday.
 Well, Microsoft CEO Satya Nadella is on the stand in the Elon Musk Sam Altman trial
 yesterday, testifying Musk never contacted him with concerns that Microsoft's stake in
 OpenAI was in violation of any special terms or commitments.
 Nadella adding he was, quote, very proud that his company took the risk to invest in OpenAI
 when, quote, no one else was willing to.
 Altman testifies today, so we'll continue to monitor that case.
 Nadella's comments coming amid a report late last night that OpenAI and Microsoft agreed
 to cap their total revenue sharing agreement at $38 billion, as it's falling a contract
 re-negotiation last month.
 And activist investor Nelson Peltz is trying to fund management, is reportedly looking
 for investor backing in a bid to take Wendy's private.
 This is according to Financial Times, try-on, it has already held talks with outside investors
 including in the Middle East.
 You could see shares of Wendy's are up 4% pre-market on this news.
 We're also watching shares of CleanSpark and Mara Holdings, both are under pressure on
 the back of earnings, posting bigger than expected losses, both of those companies doing
 that revenue also missing for the pair.
 Lower Bitcoin prices are weighing on the results, even as both companies look to pivot from
 Bitcoin mining toward AI and high performance compute.
 You could see CleanSpark, down 9%, Mara, down 4%, on the topic of crypto front and center
 for lawmakers in Washington is cryptocurrencies, and specifically stablecoins, as they work
 on legislation to regulate the sector even more.
 So now facing calls, they are now facing calls to oppose a bill on the matter, and Emily
 Wilkins drains us now with the exclusive details on all of it.
 Emily.
 Hey, Morgan, look, the crypto industry, there are only days away from seeing their top
 legislative priority, this market structure bill, get its first vote in a Senate panel,
 but this bill is facing some heavy opposition, CMBC, got that exclusive first look at
 concerns raised by the head of major labor unions, the AFL-CIO, SCIU, NEA, AFT, others,
 they all warned senators that backing a rules of the road bill for digital assets could
 legitimize crypto and, as a result, add volatility to workers' retirement, savings, as well
 as pension accounts.
 In a letter, four of the unions wrote that the legislation would invite the cryptocurrency
 industry to take outside risks, knowing that if those risky bets do not pay off, it
 is working people and retirees, not crypto billionaires who will pay the price.
 Now the labor group's opposition could make it more difficult for certain Democrats to
 support the bill.
 It's not clear at this point if any Democrats on the banking committee are going to be voting
 for the bill this Thursday, several lawmakers told me that they need to see more work done
 on language around ethics, conflict of interest, and security, but we should note here many
 Democrats, they do support this crypto legislation overall, they've been working with Republicans
 for months now to try to find a path forward, and labor isn't the only group that's come out
 against this bill, urging lawmakers to vote no.
 Banking industry is also soured on the legislation, claiming that it threatens bank deposits
 by allowing crypto companies to offer rewards that would be similar to interest payments.
 The crypto industry has pushed back saying that that is not the case, we're going to have to see
 what happens this week, but at this time it seems like at the very least all 13 Republicans
 on the banking committee are likely to vote to advance the bill, TBD on whether we actually see
 some Democrats join them, which of course will be needed if this bill wants to advance any
 further than the Senate.
 Morgan?
 Do we get some more clarity on this clarity act here in the coming days then?
 In the meantime, how about some clarity on the TikTok around the votes and confirmation
 process for Kevin Worsh?
 Morgan, do you kind of laid out, you know, we are going to see Worsh be nominated to the
 Fed today?
 Obviously the vote still hasn't happened, we expect that around 11.30 this morning, but
 if you look at what happened last night, you're seeing every Republican that was there, go
 ahead and vote for Worsh as well as John Federman, the one Democrat to vote for him as well, and
 these are all votes that just require a simple majority given that Republicans have that on their
 own.
 It seems very likely that we're going to see Worsh clear that hurdle, he'll have another
 procedural vote this afternoon that's teeing up that vote for Fed chair.
 We could see that as soon as Wednesday might go to Thursday depending on how the debate goes,
 but at this point he should be in by May 15th, which of course is the deadline for Powell's
 final day.
 Okay.
 Well, we're looking great to run through all of it with you, thank you.
 We got a lot more to come here on morning call, including a bumpy road, as of late, the
 transport sector, facing a sharp pullback over the last month.
 What from record highs?
 Let's take a look at the stocks that are driving that action, and as we head to break, let's
 get a check on AST space mobile, those shares are down about 10.5 percent right now, falling
 and disappointing earnings and revenue, reaffirmed its outlook for full year revenue with a range
 inclusive of the street's consensus estimate, but the company now plans to have about 45 satellites
 in orbit this year.
 That's down from a range of 45 to 60, and this of course after that recent blue origin
 New Glenn rocket launch that resulted in a loss of spacecraft for AST.
 This has been a high-flying stock, so down 10 percent still up very, very big in recent
 months, and recent years, morning call right back.
 Welcome back to morning call, it's been a rough ride for the transports lately.
 After peaking in late April, trading on a new record high, the Dow transports index erased
 that entire breakout, falling almost 20 percent over the past month.
 The slump being largely driven by higher oil prices and pressure from rising diesel costs,
 but even with diesel just about 20 cents from its all-time high, freight data has been holding
 up.
 So let's bring in Donald Broughton, managing partner at Broughton Capital, it's great
 to have you here on set.
 Always great to be here.
 I think some of the things that get missed is how many of these freight companies actually
 push those diesel costs out to their shippers and their customers, and we'll get to that
 in just a second, because I know that could show up in CPI, but first just what is the
 freight data showing?
 The freight data says that so far, the economy's not only well and good, but it's actually
 accelerating.
 So it's interesting, I do nothing but just follow the freight flow because it's such a great
 leading indicator, and there are really no false negatives and false positives.
 Over the years, there's been some misdiagnoses, but if you look at the freight flow, it just
 doesn't lie.
 And right now it's saying that housing is strong, some semiconductors are strong, the consumer
 spending on goods is improving, all those things that you would normally go, okay, that means
 I should be bullish about the economy or in place.
 Wait, you just said housing strong?
 Yeah, housing.
 Okay.
 Recovery is taking root.
 Housing starts, well, it's so simple, I remember back in06, I was talking to a British
 client of mine and an old Brit, and he's looking down his nose at these charts, and they said,
 these are lumber shipments, and he said, I'll throw out, you'll still make houses at
 a wood.
 And I'm like, yeah, what do you make houses out of here?
 And he goes, I'm mostly stown in Masonry.
 And I'm like, okay, well, in the US we make houses at a wood.
 And if you look at lumber shipments, they tell you what the housing starts are going to
 be.
 And right now, the housing starts, the lumber shipments are accelerating.
 So that means that somebody somewhere is planning on building a house.
 Okay.
 So you have a strong underlying economy based on the freight flows.
 You have diesel prices flirting with record highs.
 How does this translate out into broader economic data and say to the economy right now as we
 do look to CPI?
 Well, we'll see long-term how the fuel surcharges in the cost of heat and cooling your house
 and all the other energy costs end up translating out.
 But right now, let's just reduce it to simple fifth grade math.
 We take the average mileage per, you know, for average miles per gallon for a car.
 And the average miles driven by the average, you know, person with a license in a car.
 And you look at the difference between what you were spending on gas before we started
 bombing Iran and what we're spending on gas now.
 And you're basically spending $9.98, $10 a week more now.
 That's not enough to kill the consumer spending.
 They're still spending on other things.
 Does it really?
 Will it eventually?
 Okay, maybe that has an effect.
 But right now, you're spending $10 more a week at the pump on average.
 Some people are driving big SUVs and driving hundreds of miles, but on average, that's
 what the consumer's spending.
 And so far, it hasn't dampened their spending on other goods yet.
 Okay, which might be perhaps why the market's been shrugging off these higher inflation
 readings in the last couple of months.
 Okay, finally, quickly, FedEx versus UPS, as FedEx has its freight investor meeting,
 which is part of the reason you're in town.
 It's the reason I'm coming to town.
 It's good.
 Listen to FedEx freight guys.
 So FedEx is spinning off its freight division.
 And so the LTL, if you want to move two or three pallets or something instead of just a box.
 And it'll be interesting to see them spin off.
 One FedEx and UPS will look very much similar in the complexion of their business after
 they've accomplished this spin off.
 But it's also just another thing that FedEx has done to increase shareholder value.
 So one by one, by one, they've been increasing margin, increasing free cash by backstock when
 it was advantageous.
 And they've taken the stock over the last three years from under 150 to 380.
 And the meantime, UPS has gone from 200 to 100.
 So quite the divergence.
 Yeah.
 It's quite a chart.
 Donald Broughton.
 It's great to have you here on set.
 Thank you.
 Obviously be a pleasure.
 All right, well, we're going to hear more on the state of freight.
 And so much more, when FedEx's CEO joins Jim Kramer exclusively on Madmoney tonight at
 6 p.m. Eastern.
 You don't want to miss that.
 Well straight ahead of the morning call crew, TN up the trading day, and a market triple
 threat.
 Inflation, chips, a Trump sheep, one-on-one.
 What it all means for your money on the other side is freight.
 Welcome back.
 It's time for your call sheet where we look at the topics driving the trading day ahead.
 The crew members today, David Zervos, chief market strategist at Jeffries, Ryan Dietrich,
 chief market strategist at Carson Group, both are CMBC contributors.
 And Jose Torres, senior economist at Interactive Brokers, we're great to have all of you here
 a lot to get through.
 Jose, you're sitting right across from me.
 I'm going to start this conversation with you, inflation, CPI on tap today.
 What are you watching?
 Yeah.
 Well, I think that this stock market rally has been terrific.
 Now I think going forward, though, we are going to be having to withstand higher rates
 because not just this report, we're expecting 3.7 percent Morgan, may, June and July are likely
 to come in above 4 percent, coinciding with the new Fed chair.
 It's going to be interesting to see how investor sentiment holds up against that backdrop.
 Alongside what's happening with President Trump and Xi Jinping coming up, meeting up soon,
 as well as, of course, oil being above $100 and tensions flaring in the Middle East.
 Okay.
 Speaking of Worsh and going through the Senate confirmation process here, David Zervos,
 I mean, you've been writing pretty extensively about this rates versus balance sheet.
 How does all this factor into the inflation conversation as we look through the end of the year?
 I think people are looking through the inflation, Morgan.
 We know that this is a temporary move.
 We don't want to use the other T word, but we know that the market sees it that way.
 All the inflation expectation data, whether it's tips market or survey data, suggest that,
 yield curve suggests that, any measures term premium suggests that.
 So we know what it is.
 And I think we're going to be talking about a lot of lower oil prices by the end of
 the year and possibly even earlier, especially things like sanctions across different jurisdictions,
 not just Iran, but possibly Venezuela and even Russia and Ukraine start to become the
 focus as we get through into the summer months.
 So I don't think the market's getting hot and bothered about a big headline move.
 They're going to look at the core.
 They're going to make sure that the trends in the core are still what they had expected,
 some of the housing stuff being weak.
 And as long as that's the case, I think it'll be a much more of a nothing burger on the
 headline than anything else.
 And that's what I expect.
 Yeah.
 I mean, it is interesting, Ryan.
 We've got S&P and Nasdaq trading at record highs, sitting at record highs right now.
 Even as crude prices are higher, treasury yields are higher.
 And the VIX, at least in trading yesterday, it's still, it's still subdued, but ticked
 higher as well.
 I mean, the read through here is perhaps, well, I guess I want to hear your thoughts
 on this.
 But how much is AI build out powering this?
 Well, first off, good morning.
 Thanks for coming back.
 Listen, we all saw the GDP number a couple of weeks ago, right, 2% GDP in the first quarter.
 Like half of that was coming from the AI build out the last five quarters on average.
 So that is, we know that, but you know, I want to talk about something Jose mentioned.
 He mentioned investor sentiment.
 I think it's amazing, Morgan.
 Everything you just mentioned, hit new highs, up six weeks in a row, up 16% these last
 six weeks.
 You look at sentiment and I get to travel to country and work with clients all the time.
 People aren't that happy.
 I mean, they really aren't.
 Look at the cover of the New Yorker, right?
 It's George Washington.
 I'll beat up, talk about red, white and kind of blue.
 Right.
 We barely saw any more bulls in the A AI sentiment poll.
 And then one more, you know, look at hedge funds.
 I mean, hedge funds are really decreasing their allocation to tech over the last two weeks,
 like the most we've ever seen.
 So there's pockets of optimism.
 Yes.
 But with stock market hitting all time highs, these expectations are so low.
 I think we continue good news, kind of like you guys have talked about this morning already
 on the economy.
 I think this bull market's alive and well.
 Yeah.
 I mean, certainly semiconductors have been surging here, Jose.
 And bespoke yesterday, notes the socks has moved up 60% above its 200 day moving average.
 And that these are levels that have only been seen two other times, July of 1995 and March
 of 2000.
 I mean, you're starting to hear these comparisons to dot com bubble.
 I mean, warranted?
 You know, I think it's mixed.
 I think overall, the earning story is very buoyant.
 And one thing that Ryan was talking about is overwhelmingly we're seeing a lot of some
 of our customers caught off size by this significant move that occurred so fast.
 No one thought that the economic fundamentals that have worsened somewhat from the beginning
 of the year to now would be accompanied with this surge in earnings expectations from
 the semiconductor space.
 So to the extent that that area can sustain that level of buoyancy, then I think we can
 go a lot higher.
 But in the past, we've had some cyclicality with memory chips and those kinds of those
 kinds of technology areas.
 So that's something to watch.
 Yeah.
 And certainly that's the debate.
 And whether we're entering a more secular period for the likes of micron here, David, want
 to get your thoughts as we do look to this Trump sheet meeting later this week on the
 geopolitical stance of everything and how this is pricing into the markets and what
 it means not only for investors but for the economy overall too.
 Going back to your comments about sanctions, I think in particular.
 Yeah, I think, you know, we have a president that would like to do it deal.
 He loves to do deals.
 I think he's going to be either touting them or teasing them or closing them.
 And he's got a lot of CEOs from a lot of very important companies with him.
 This is a business friendly administration.
 That's a lot of what this rally, I think, is built on.
 It's not just AI and productivity.
 It's part of what's been touted in the one big, beautiful bill, the deregulation, all
 of the things that we've listened to since this administration began.
 And I think we're going to see that in action.
 The market could like it a lot.
 I think you've got Secretary Besan over there also working with the Japanese, the Koreans.
 There's just a lot of really good news for the market when it comes to deals and investment.
 And I think the market's going to key off of that and it has keyed off that.
 I think it's really pushed aside a lot of the geopolitics related to things like Iran
 or other areas, like still the Russia-Ukraine situation, which is terrible.
 But I don't expect geopolitics to weigh on this market.
 If we were going to go down that route, we would have gone down that route the last couple
 months.
 Ryan, we've got 20 seconds left, final words, final thoughts.
 Well, let's think about this.
 Up six weeks in a row, up over double digits during that.
 The only nine of the times in history has happened.
 One year later, we've been lower only once and that was 70 years ago.
 So this strength we've seen, I think it's going to continue.
 One more quick one, probably five seconds.
 The market rarely ever peaks in May or June, only twice in history.
 So again, I think the summer rally is going to continue here.
 All right.
 Summer 11.
 Thank you to our morning call crew.
 Scott Buck starts now.