Taking On Trump's Agenda, Back On Top, Searching For Direction. 6/4/25
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President Trump calls out China's Xi, Musk calls out the big beautiful bill, and Wall Street waits as Trump's latest tariffs take effect. And a familiar name regains the top spot in the race for the world's most valuable public company. Futures this morning, well, they're kind of searching for direction right now, in the green across the board. It's Wednesday, June the 4th, 2025, and this is Worldwide Exchange on CNBC and streaming on CNBC+.

Good morning. Thanks so much for being here with us. I am Frank Collins. Get you ready for the trade day ahead. We begin with the U.S. markets. The Dow on a four session win streak. The S&P and the Nasdaq positive for the first two trading days of June. Today is also the White House's reported self-imposed deadline for best offers on trade deals from other countries.

and investors. They're waiting for a call between President Trump and the Chinese president. President Trump weighing in on a possible call on Truth Social this morning, calling Xi, quote-unquote, extremely hard to deal with. We're going to have the very latest from Beijing.

Coming up in just a moment. All right, right now, taking a look at U.S. stock futures. You can see we're in the green across the board. Looks like the Dow would open up about 70 points higher. The S&P and the Nasdaq seeing some fractional gains in the pre-market as well. We also want to look at S&P 500 pre-market leaders right now. Taking a look at those names, you see HPE right here at the top of the list.

following earnings. Wells Fargo moving 4% higher after a decision that lifts some restrictions on its business. Dollar Tree also reporting earnings. Simon Property and Moderna running out your best performers. Then we have the other side of the coin, the laggards. We have S&P laggards right here. CrowdStrike also following earnings, pulling back right around 6.5%. Eaton, BNY, Iron Mountain, and Constellation Energy running out your worst performers. Constellation actually pulling back

after gains yesterday following a 20-year deal with Meta to provide power for data centers. Right now, Constellation Energy pulling back about 1.5%. This morning, we're also looking at NVIDIA. It popped almost 3% yesterday on some bullishness over that potential U.S.-China call. Also, we're getting the title of the most valuable U.S. public company for the first time since January. Taking a look right here, you can see NVIDIA shares right here. Week to date, they're up more than 5%, Microsoft up just under 5%.

a half a percent here's the market caps right now nvidia sitting at 3.47 trillion that's with the t uh microsoft right here at 3.435 right now at this hour we're going to continue to watch this race between these two giants also look at the energy market this morning oil finished right around one and a half percent higher yesterday taking a look this morning a bit of a pullback wti crude and brent crew both pulling back about a third of a percent natural gas also pulling back

about one and one third of a percent. And a quick look at Treasury yields. They ticked slightly higher in the last day or so. Right now you're seeing the benchmark at 4.46. The two-year 3.95. Down here, the long bind at 3. excuse me, 4.98. Yesterday, I believe at this hour was about 4.93. Okay, that is your setup now for a check on the trade in Europe and over in Asia. Our Karen Cho is in London with a look at the action. Karen, good morning.

Good morning, Frank. Well, the diversification trade has gone on for the rest of the world away from the United States, and Asia is one of the targets. So some progress on the politics in South Korea certainly helping across the region today. South Korea has elected a new president after a failed attempt at military rule brought down the previous leader of Asia's fourth largest economy.

The new Liberal President, Lee Jae-myung, who pledged to revive democracy and the economy, won 49.4% of the vote. You can see a bounce in particular for the KOSBI in South Korea. Some of the big tech names in focus, and that is helping the KOSBI, but also the Japanese stock market today, that it is tracking up 0.8%. But more

broadly, you mentioned the Nvidia story versus Microsoft and escalating past Microsoft on market caps. One trillion dollars, the size of the balance that we've seen just in the last two months alone. Well, that AI status on the back of the earnings we saw recently, very much helping some of the big semiconductor

Back to you, Frank.

All right, Karen, thank you very much. Our Karen show live in London. Turning back to President Trump and his post this morning, calling out Chinese President Xi Jinping as very touchy and, quote unquote, extremely hard to deal with. Our Eunice Yun has the reaction from Beijing. Eunice, I would imagine there is quite the reaction. We're showing the post right now. The president starting off saying he likes President Xi, then going on to make some comments that I think a lot of us would consider pretty critical.

Actually, the response in China was not very aggressive at all, which is in line, actually, with what the Chinese have been doing. So the foreign ministry was asked about President Trump's post at a regular briefing today, and it responded, the principle and position of developing China-U.S. relations have been

consistent. So this is the message that we hear regularly out of Beijing. And the foreign minister had met with the new U.S. ambassador and then repeated China's accusation that the U.S. is the one that broke the Geneva truth. And he repeated China's claim that it vigorously and faithfully, he said, carried out the Geneva deal. Of course, this is despite the

not lifting export curbs on some rare earth metals, as was widely expected by Washington. But I think what's interesting here is that this has been a feature of the relationship of the two sides since President Trump came into office, where you see the U.S. policy towards China fluctuate

including on tariffs, while China's stance and the messaging remains consistent. And this tells us that the Chinese really think that their policy of standing their ground works. And in fact, Trump's post could reinforce in a way this stance that China is holding its ground. It's hard to say, though, Frank, if President Trump is suggesting that he had a conversation with President Xi. The White House has said that a call with President Xi would be taking place as early as this week.

Yeah, by the way, we're showing ETFs that represent Chinese equities. They're higher right now. The MCHI up about one and one quarter percent. So, Eunice, you really led me to my next question. Does this influence at all this potential call or do we have a sense if this is a response to some type of call or communication directly between these two leaders?

I mean, I think we don't know. The foreign ministry had said that they had no information on a call between President Trump and President Xi. Of course, they might not know the details of what's going on. I think what's interesting, though, is that China continues to indicate that they are not in a rush for a deal, that this comment by President Trump indicates, especially here in China, that President Trump is the one that wants to deal more, that he

that he's the one in the rush. And I think you're going to see the Chinese really seeking to exploit that imbalance. It doesn't mean that they won't want to really come to terms with something, to agree on certain things, but it does mean that they will move only when they believe that the terms are right. Eunice Yun, live in Beijing. Eunice, great to see you as always. Thank you very much.

We're going to stick with President Trump as new tariffs on steel and aluminum imports in effect as of about midnight as his office faces new attacks from one of his most vocal supporters. NBC's Chris Pallone joins us now from Washington with much more on this story. Chris, good morning. Yeah, Frank, good to be with you and good morning to you. You know, congressional Republicans are walking a tightrope as they try to pass all of President Trump's legislative priorities in this spending era.

and tax cut bill, trying to do it in one bill without any support from Democrats.

As tariffs on aluminum and steel double for most U.S. trade partners overnight, dissent is bubbling up among some of President Trump's allies over his signature spending bill. Billionaire Elon Musk, who spent months trying to slash government spending as a temporary government employee, blasted the president's self-proclaimed big, beautiful bill as a disgusting abomination. Writing on X, Musk complained the president's plan will massively increase the gigantic budget deficit.

Some GOP budget hardliners agree. I can't in good conscience give up every principle that I stand for and every principle that I was elected upon, and that's that you can't accumulate more debt. Independent analysts project, as written, the bill could add several trillion dollars to the deficit. It extends tax cuts, boosts spending on defense and border security, and includes cuts to Medicaid and food aid programs. The White House is brushing off Musk's criticism.

Look, the president already knows where Elon Musk stood on this bill. It doesn't change the president's opinion. This is one big, beautiful bill, and he's sticking to it. It comes as the president's latest tariffs on steel and aluminum took effect overnight, doubling from 25 percent to 50 percent. With China as a top competitor in the industry, the White House says President Trump could speak with President Xi in the coming days. There will be a leader-to-leader talk very soon.

President Trump escalating his trade war, risking increased costs for Americans to potentially shore up the nation's steel industry. Republican members of the Senate Finance Committee will huddle with the president at the White House later today, trying to figure out how to tweak that spending and tax cut bill so that it can pass both houses of Congress. Frank, back to you. All right. Chris Pallone, live in D.C. Chris, always a pleasure to see you. Thank you very much.

Turn our attention now back to the markets. Investors are starting to ramp up their bets against a dramatic shift in Fed rates due to the potential impact of President Trump's trade policy. The markets, they're still pricing in two rate cuts this year, the first one coming up in October. But Bloomberg reports economic uncertainty is pushing options traders to hedge on a wide set of outcomes from a series of half point cuts by the end of this year.

to possibly none at all. Joining me now is Ben Emmons, founder of FedWatch Advisors. Ben, good morning. Good to see you. Good to see you, Frank. All right, which camp are you in? A couple rate cuts later this year, none at all. I think there will be rate cuts. The Fed has some room now to cut, right, because inflation has actually fallen significantly.

And the inflation expectations may look to start to fall, too, if we really get to a point of de-escalation, the trade war that there's are not going to be as high. So as expectations fall, the Fed has room. But the timing seems to be challenged because of the uncertainty. And I think this is where the market is still waiting for. But I think the Fed is in a position to cut. So it likely will follow through in the later year. You know, I think we're going to have to watch the Fed fund futures today because after that post from the president out,

I don't know what that means for the trade negotiation situation or the environment right now and what that means for the pause, the three-month pause. So the possibility of Fed cuts, what does that mean for bond yields? Bond yields seem to have a really big impact on the markets for most of this year. How do you see it impacting the long bond, the 30-year and also the 10-year? Yeah, I think we're going to go back to what we had last fall. If we cut rates and the economy is already recovering from this April shock,

then recovery is going to continue and maybe accelerate as you cut rates. So yields should go a bit higher from here as opposed to lower, at least in the initial phase. I think we're going to test probably close to the 5% in the 10 year, simply because this economy is picking up and as the Fed gives it a little push,

then, yeah, that will happen. Let me ask you about the two-year, because really the Fed has the biggest influence on the two-year. Right now it's at 3.95, kind of in the neighborhood to be competition for equities. As we see a more dovish potential coming out of the Fed, I guess that's the way to put it, does that lower the yield on the two-year and kind of reduce some of that pressure from the bond market on the equity market? I think that's right. I mean, I think that the two years reflecting where the Fed will be the next two years is

And so it could go a little lower in yield as the Fed cuts rates. So I think, yes, that would relieve the pressure. And I think the markets take the rate cut as good news, as Wallace says, because the Fed's doing it because inflation is going to go down. But if you push the economy with a rate cut, then you're going to get the low end going higher. So I think it's a steeper yield curve, too, as a result of that action benefit. A lot of eyes on the Fed, a lot of eyes on the ECB. You know, cuts possibly come in there, too. Ben Emmons, always a pleasure to see you. Good to see you, Frank. Thank you.

All right, we've got a lot more to come here on Worldwide Exchange, including fallout from President Trump's new tariffs on the metals complex and if U.S. suppliers can make up the difference. Plus, live from the Super Return Conference in Berlin, a first-on-CNBC interview with Sixth Street co-CIO Julian Salisbury, his first since he left Goldman Sachs, or Leslie Picker has it. A very busy hour still ahead when Worldwide Exchange returns. Stay with us.

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All right, welcome back to Worldwide Exchange. We've got a market flash for you now on Tesla. She has a Tesla up about a half a percent, but the news here is that sales of the company's China-made vehicles falling 15% in May. That's according to data from the Chinese Passenger Car Association. Deliveries of the Model 3 and the Model Y, they did rise 5% from the previous month. Tesla's Chinese rival BYD, different story there. Seeing its sales jump 14% in May. Right now, Tesla shares up just about a half a percent.

All right, moving on. President Trump's increase to steel and aluminum tariffs started right after midnight Eastern time, putting the supply squeeze on a sector that's really remained resilient despite trade wars and recession fears. Joining me now is Francisco Blanche, head of global commodities and derivatives research at Bank of America. Good morning. Thanks for being here in studio. Thank you for having me, Frank. It's great to be here.

So walk us through this. So yesterday we got that OECD outlook on GDP. They actually reduced it. They reduced it down to 2.9%. You're a bit lower than that. You're at 2.8%. And then you also came out with your oil forecast. Your oil forecast for the end of the year is lower than oil is trading at right now. What does that mean for the oil market? Does that mean it moves sideways from here, or do we see volatility? What happened? So I think the next few months we're going to move into a surplus in the market, which

So remember, OPEC has been adding a lot of barrels and we are about to hit peak driving season, which is July 4. So once we get past that July 4 window, prices are likely to roll down because demand is going to ease. We're going to go into what's called the shoulder season, September, October. But importantly, we have all this new supply coming in. So we think, again, the surplus drives prices lower. We'll see Brent

Maybe break below 60, bounce back a little bit around low 60s, and eventually settle there, eventually go higher. We think next year once we get through a straight shock. All right.

will be higher. So what's priced into this forecast? Is the idea that there's going to be a resolution of tariffs already priced into this forecast? I mentioned on the show yesterday, I was talking to Michael Hartnett from Bank of America, chief investment strategist. He believes tariffs are kind of that narrative is over and done with. He thinks the whole thing's resolved by Labor Day. And it's really about spending bill here in the U.S. and tax cuts.

So are you pricing in the idea that tariffs resolve themselves at some point at the end of the summer? You mentioned 4th of July, obviously Labor Day is the end of the summer. And then that spending cuts actually kind of inject some strength into manufacturing other businesses or tax cuts? Yeah.

I think they do, but, you know, Frank, they'll do probably in 2026, right? Which is why we still have our $70 a barrel Brent forecast, $6 a barrel for WTI. So we think, again, it's going to be a weak second half of the year, followed by potentially a stronger 26. All right.

Let's talk about some other commodities right now. Gold seems to be a safe haven trade. People are going there. Even part of that sell America trade when it comes to currency. Seems like some of that money is going into gold. Absolutely. What about copper? I'm looking right here since the tariffs were announced. Copper is down about 3%. Steel is up about 6%. I mean, what does that tell us about the global economy? Of course, one thing the tariffs do is they throw a lot of sand in the wheels of trade. And trade is connected to industrial activity. And, of course, metals are driven by industrial activity. So, yeah.

No surprises that metals are not doing particularly well. Perhaps the surprises that metals have been holding up firmly. And I think a lot of it has to do with the fact that, for example, when you look at aluminum, if you look at the regional premium, what's called regional premium, so we've seen very firm prices inside the U.S. of A. Because now if you want to bring aluminum into America, and America imports 90% of its aluminum, Frank, right?

you just have to pay a lot more for it. So that's the issue with tariffs. I'm not sure they're going to necessarily bring back manufacturing in the way that is hoped at times, but the one thing they're doing is they're making things more expensive to produce in America. So, for example, they're squeezing industry, but they're also squeezing...

Let's say if you're an oil producer, you've got to spend a lot more money in your steel and your aluminum to make that oil, and prices are down. So generally, corporate margins on the industrial side, they're taking a bit of a hit on the back of tires. It's interesting that you go to aluminum or aluminium. I think that's what you guys call it over in Europe. Steve Sedgwick always says that. People always call it copper, Dr. Copper. So why do you think aluminum is more telling of what's going on in the global economy than copper?

Well, copper has become a little more linked to the energy transition, right? So it's linked to the EV story you were talking about, you know, like how BYD is selling tons of EVs now. China is going electric, and there's a lot of copper demand for that. There's also a lot of copper demand in terms of the grid.

There's an enormous amount of investment trying to upgrade grids worldwide because of the power demand story that we're seeing. And that means copper has become maybe less sensitive to the economic cycle, in our view. So we're still bullish on copper, to be honest. Pretty bullish. Forecast for Brent and WTI, 65 a barrel, 61 a barrel. Francisco Blanche, great to have you in studio. Thank you. Usually talk to you over in Europe. Great to have you here. Thank you. All right, still on deck here on Worldwide Exchange, your big money movers, and a more affordable morning cup of coffee. We are back right after this.

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All right, welcome back to Worldwide Exchange. Time now for your big money movers. We are going to start off with shares of Wells Fargo. You can see they're up just about three and a half percent. The company in the clear, the Fed lifting asset cap restrictions placed on the bank back in 2018 tied to its fake account scandal and alleged toxic culture. The move is going to allow the bank to pursue growth in areas such as credit cards, wealth management and commercial banking.

It's also a major win for CEO Charlie Scharf, who's been cleaning up the company since taking over back in 2019. Scharf will be on Squawk on the Street today for an exclusive interview at 9.15 a.m. Eastern. He'll be followed by Senator Elizabeth Warren, the ranking member on the Senate Banking Committee in the 10 a.m. hour. She calls that decision a, quote, outrageous giveaway to one of Wall Street's most derelict banks. It's going to be a very interesting interview coming up again, 10 o'clock on Squawk on the Street.

Moving on to an earnings mover, CrowdStrike swinging to a first quarter loss. You can see shares are pulling back about 7%. The cybersecurity company also giving weaker than expected revenue guidance for the current quarter. The company says the cost of its software outage last summer, that continues to weigh on its results. CrowdStrike adding that revenue is still being hurt by the incentive program it launched last year to retain customers. Again, shares down about 7%. CrowdStrike CEO George Kurtz, he's going to sit down with our Jim Cramer tonight on Mad Money at 6 p.m. Eastern.

Another earnings mover, Hewlett Packard Enterprise. Those shares, they're higher, up over 5%. Earnings and revenue beat estimates. The server and cloud software company also raised profit outlook for the year, driven by demand for AI products, even as it continues to navigate uncertainty around the economy and also trade. Shares of HPE, they're up over 5%. And looking at shares of Asana, they're dropping. The maker of work management software reporting better than expected first quarter results.

But revenue growth slowed to 9 percent in the quarter compared to strong 26 percent growth that the company reported just a year ago. Shares of Asana, they're pulling back nearly 8.5 percent.

All right, as we had a break, got a little good news for you, especially for all you early risers. Watching Robusta Coffee Futures hitting their lowest level since November. Prices down more than 11% this year. The USDA forecasting that Vietnam and Brazil, the world's top Robusta and Arabica coffee producers, I don't drink coffee, respectively. They're going to increase output by 7.5% in the year ahead. So maybe you want to have a second cup. Looking at Robusta Coffee Futures right now, they're up just about 1%. Much more Worldwide Exchange coming up after this. Stay with us.

I do think we're still at the earliest stages of AI and so the demand will continue for a while. I know the stock will peak before demand peaks, but I don't know when that is.

So that was Karen Feinerman on Fast Money last night talking NVIDIA and the AI trade. NVIDIA reclaiming the title of the most valuable public company in the world. Welcome back to Worldwide Exchange. I'm Frank Holland. Coming up this half an hour, we're going to have much more on that stock and the broader AI trade, including Dan As from Wedbush. He is here with his updated list of top AI stocks, and he's got a new ETF out. We're going to talk all about it.

But first, let's get you ready for the trading day ahead. We begin with the U.S. markets, the Dow on a four-session win streak, the S&P and the Nasdaq positive for the first two trading days of June. Also, today is the White House's reported self-imposed deadline for quote-unquote best offers on trade deals from other countries and investors. They're also waiting for a call between President Trump and the Chinese president. President Trump weighing in on a possible call on True Social this morning. Take a look at this.

He called the Chinese President Xi, quote unquote, extremely hard to deal with. Started off with, I like President Xi, and then calls him very tough and extremely hard to make a deal with. We'll see how that impacts the equity market both here and across seas. All right, moving on. We also want to look at U.S. stock futures.

Right now, taking a look at those, you can see we're in the green across the board. The Dow looks like it would open up about 88 points higher. Fractional moves higher for the S&P and for the NASDAQ. Also want to look at the Russell futures in the pre-market. The Russell moving more than a percent higher yesterday. Right now, Russell futures up just about a half a percent right now. Really quick, we're going to take a look at the NASDAQ 100 pre-market gainers and laggards. Taking a look at the gainers first. Right here, you see NXP Semiconductors top of the list up, up.

just about 1.5%, followed by Fastenal, Marvell Technology, On Semiconductors, and PDD Holdings, Chinese tech stock here. Then the other side of the coin, the NASDAQ 100 laggards, right here at the top of the list. CrowdStrike shares pulling back more than 7% after earnings. The company's saying that that

Outage last year that happened in July of last year continues to weigh on the company, followed by Constellation Energy pulling back after getting a pop yesterday, signing a 20-year deal with Meta right now, pulling back about 2%, followed by Exelon Palo Alto Networks, another cybersecurity player, pulling back about a half a percent Zscaler also in the cyberspace.

All right, really quick, we want to take a look at the AI trade as well. NVIDIA regaining the top spot as the most valuable publicly traded company as the AI chip leader moved higher yesterday, almost 3% higher on hopes of U.S.-China trade talks. Taking a look at the action right now, you can see NVIDIA shares up three quarters of 1%. Microsoft pulling back very fractionally. Palantir up a third of a percent. Tesla up three quarters of 1%. We also got Dan Ives coming up.

With his new IZ ETF, also an update to his AI30 list, his top picks in the AI space. Some of these names going to be on that list. And checking the bond market this morning as well, taking a look at yields. We saw yields just tick up just a bit from the levels that we saw yesterday. Right now the benchmark at 4.46. Down here, the long bond actually ticking up while we're doing the show. Very close to a 5% yield right now at 4.99%.

Okay, that is your setup now. We want to turn our attention to what is known as private capital's most senior gathering. Nearly 2,000 attendees with more than $50 trillion in assets. They've come together in Berlin for this year's Super Return International. And that's where we find our own Leslie Picker. And she's joined by a special guest for a first on CNBC interview. Leslie, good morning.

Hey, Frank, good morning. Thank you so much. Yes, Julian Salisbury, co-CIO of Sixth Street, manages about $100 billion of those assets you just outlined.

So let's start with the macro, because you oversee a bunch of different asset classes, so I'd love to get your perspective on what's going on in the broader economy front. So we've got multiple Fed officials raising alarms, raising concerns about the risk of stagflation. They say that tariffs haven't yet had an impact on pricing, but that that could change in the coming weeks. Have you gotten any sense from the portfolio companies that you work with and the borrowers that you work with that that could be imminent?

Look, I think when we look across our portfolio, you have to think about first order effects, second order effects, and be, you know, have some humility about the uncertainty that exists in the market today. When we look across our portfolio today, generally the first order effects are still pretty muted. Part of that is about industry selection that we focused on. So tending to more focus on technology, healthcare services type businesses that are less directly exposed to that.

I do think it's still early to say about the longer-term effects of tariffs. And I think we all have to be aware about the broader impact on the economy. Nobody's going to be immune to this. Uncertainty is never great for investment. It's never great for consumer expenditure. And it's going to be many months before we see this fully roll through the portfolio, I think. Also, kind of sticking with the idea of the macro picture,

in particular, what's going on in Washington with the deficit right now. We had Jamie Dimon speaking last week saying that he expects there to be cracks in the bond market as a result of just these exorbitant levels of national debt. Is that a concern of yours? And how does that impact, if that does indeed happen, how does that impact the private

credit investing landscape? If you look at how Sixth Street was formed, we were designed really to operate in any market environment. We are macro aware, but the investments we're making are not typically predicated on a particular movement, rates or effects of commodity prices. We generally try to hedge that out. But

That being said, you can't ignore what's going on in the bond markets. At the end of the day, all risk prices offer the risk-free rate, the treasury rate. We actually think a harder environment when rates were bounded at zero and everything was moving up and to the right, that was actually a particularly tough investment environment for us. What we're finding right now with rates high

and we think remaining likely to come lower from where they are right now, but to stay structurally higher than they've been over the last few years, it's going to result in a greater dispersion of performance. It's going to result in asset selection actually mattering. So we actually feel that

that's a pretty exciting environment for us. When I look back over the years, some of the best investing periods for us have been when uncertainty has been at the highest. In 2020 was a great deployment year for us. When things are absolutely dissipated and collapsing, transaction levels tend to stop and that actually makes deployment hard.

But they kind of modeling along higher for longer environment. I think it's a good environment. Interesting. I think Frank has a question for you back in studio. Hey, Julian, how you doing? This is Frank Holland back at CNBC headquarters. Thanks for joining us this morning. A lot of talk there about an end to U.S. exceptionalism. We've seen some signs in the currency market. The dollar's down about 9 percent since the inauguration. How does that shape your view of emerging markets with the idea of a softening dollar? And how does that shape your view of Europe with a rising euro?

So, great question. Around October, November last year, it felt like people had almost thrown in the towel and just said, like, we've just got to go in, all in on U.S. growth. And that was never the right answer. If you look towards the end of last year, our view was, when you looked at the valuation gap that had actually emerged between U.S. and Europe over the last 10 or 15 years, just given the structural environment,

the relative lack of capital available in the market versus the U.S., and yet great businesses that exist both in Europe and in Asia, that this would set up for a good environment for us. So if you're coming to this year, what's really happened? I'd say two things. One,

people became more cognizant of the magnitude of that valuation gap. The gap had just gotten too wide. 30-40% premium in certain cases. Second, like this divergence in fiscal performance where, you know, US looking to cut expenses, cut spending. Europe on the other hand

And then the third thing, just from a geopolitical perspective, I don't think the US exceptionalism story is gone. I mean, it's still the biggest, the best investible market in the world. It's great rule of law, transparency, great talent, just a real depth of companies that you can invest in across sectors and asset classes.

I think a lot of people were just starting to say, well, you know what? I've kind of gotten overweight. You know, just give me out performance of my US assets over the last five to 10 years. You know, maybe there's a chance to rebalance. A lot of people on those marginal decisions are saying, maybe I should be looking at Europe and Asia now, both as a diversifier

a rebalancer, and just recognizing that those valuations have gotten out of whack. So we think it's a good investing environment outside of the U.S. It really feels like a massive narrative shift here at Super Return from last year, where everybody was still in that U.S. exceptionalism camp, at least it felt like that, and

And this year, there is more embracing of opportunities in Europe. Kind of speaking of bigger trends that we see here at Super Return, private credit each year keeps generating more and more airspace at this conference, just given the growth in that area. You guys are obviously huge players and early players in private credit. So I want to ask you what you think of some of the recent warnings, whether it's from

the Fed, which just had a report showing the enormous interconnectivity between private credit and the financial sector, or Moody's, which believes that the next crisis could come from private credit. What do you say to reports like that that are sounding such alarms? Yeah. So, first of all, I think something like 85% of all companies in the U.S. with more than $100 million of revenues are

So there's a huge need for growth, capital for those companies. And notwithstanding the fact that the regulatory environment for banks looks like it's going to be easing, there's a huge need for capital in that space. Second, I think there's a secular demand growth from all forms of investors, institutional investors, insurance investors, wealth investors, to have exposure and interest in this asset class. When you have that level of capital flowing in,

and the way it's flowing in. So you've seen massive growth, specifically in direct lending capital over the last four or five years, a lot of it in evergreen fund format, which means that money has to be deployed right away. It's naturally going to give rise to some concerns and questions. And I do think that particular part of the market is tricky right now. We like the way we're set up to play that. The way our capital is organized, it allows us to be able to fade at points like that and reallocate capital.

towards things where we're seeing labor rates in terms. Look, when that much capital comes in, there's definitely a level of complacency in the direct lending market specifically, but credit's a much bigger asset class than that. There are opportunities in ABF and opportunistic credit and real estate lending. So we're really, you know, our aperture gives us an opportunity to like fade markets when we see there's too much capital and look at other areas. Yeah, and you've seen both sides because you now work for Sixth Street in kind of the private credit space coming from Goldman into more regulated

banking space. Julian, thank you so much for being here from Super Return. And later next hour, we will have Orlando Bravo of Toma Bravo to continue this conversation about private markets, particularly what he is seeing in software as well as AI and other areas of tech investing, just fresh off of a ginormous fundraise that they just had. I'll send it back to you, Frank.

I'm sure that'll be another great interview. Also, you're going to join us again tomorrow. You're going to bring another great interview to us. We're going to have much more from the Super Return Conference tomorrow here on Worldwide Exchange, including Leslie bringing us an exclusive conversation with Vista Equity Partners CEO Robert Smith. You don't want to miss that one. It is going to be a good one. Make sure you catch it tomorrow right here on Worldwide Exchange. All right. Coming up, a double edged sword for the housing sector. Why good news for renters. It could be bad news for investors. We got all the details from Worldwide Exchange Returns. Stay with us.

Welcome back to Worldwide Exchange. Turning now to the housing sector, there's some good news for apartment renters, but not so much for investors. Our Diana Olick joins us now with much more on this story. Diana, good morning. Good morning, Frank. That's right. Apartment rent growth is suddenly slowing at a time when it usually ramps up.

Rents in May grew by just 0.4% from April, less than in May of last year and the year before. So now rents are 0.5% lower than May of last year. This after they had been moving closer to positive territory over the last six months.

Now, all of this is according to ApartmentList. In actual money, though, the national median monthly rent is now $1,398, up $5, not a lot per month compared to last month, but down $6 compared with May of 2024. Why? Well, because vacancies are on the rise, again, hitting 7% in May,

That's the highest since apartment lists began tracking this in 2017. And that's all because just a ton of new supply over the last few years. Last year, in fact, saw the most new apartment completions since the mid-1980s. Multifamily construction peaked last year and is now on the slide, but there's still a lot of new supply this year as well. And that's the national picture. But all real estate, as we know, is local, and some markets are seeing much steeper rent declines.

namely Austin, Denver, and Phoenix. These are markets that overheated during all the pandemic migration and are now cooling fast, both in rents and home sales. That's good news for renters, not necessarily, though, for the REITs in the space, like Avalon Bay, Camden Property Trust, and Equity Residential. Rents are expected to strengthen, though, later in the year. Frank?

Diana, thank you very much. We're Diana Olick, live with the latest look at renting and the market there. Thank you again. All right, coming up here on Worldwide Exchange, we've got Wedbush's Dan Ives. He's standing by. We're going to get the names on his revamped list of top ideas to play the AI trade, also his new ETF. We'll be right back after this. Stay with us.

Welcome back to Worldwide Exchange. Quick check on NVIDIA and Microsoft. NVIDIA once again passing Microsoft in market cap to become the most valuable publicly traded company in the world. You're looking at it right there. NVIDIA at $3.477 trillion with a T. Also, we've got Wedbush's Dan Ives updating his top 30 names to play the AI trade. NVIDIA and Microsoft among the top picks, along with Alphabet, Amazon, Meta. Wedbush also announcing a new way for investors to tap into the AI trade. And our Dan is here on set. The new way?

The Ives ETF, IVES. No, we're so excited to be launching here with you, Frank. I mean, look, around the globe, investors are always asking, how do you play the AI theme? What are the ways to play it? And this is an ETF. It's based on our research. I mean, the AI, Ives 30, and really showing it's not just about...

It's about the second, third, fourth derivatives playing out in this fourth industrial revolution. It's a golden age for AI just beginning. All right, we're going to talk more broadly. If people want to read about your ETF, we're going to have something up on CNBC Pro, a lot more details. Jesse Pound, I believe, always does a great job, so they can read all about it. All right, I want to talk to you about the AI trade more in general and some of the names in your AI30 list. One I got to talk to you about is Tesla. Mm-hmm.

It's one of your top picks when you're looking at automotive and robotic. However, it seems like Elon Musk and the president are not seeing eye to eye right now, really criticizing his spending bill. Does that change the thesis on Tesla at all that they're going to have a more permissive regulatory environment under the Trump administration if potentially these two guys are not getting along? Yeah. Look, I mean, first off, the best thing that ever happened from a Tesla bull in terms of the autonomous vision is Musk leaving the White House. So first off, too. For sentiment on the stock. In terms of sentiment, in terms of...

the brand issues, Doge, and now you have the focus on autonomous and the launch in Austin. I believe that's going to be worth a trillion dollars alone in terms of the autonomous vision to Tesla. Look, in terms of the sort of beef going on between Musk and Trump, I think it's expected relative to the energy credits and what this could mean for Tesla, as well as in terms of Musk's

reaction and relative douche, but it does not in any way make our view any sort of negative. I think this is going to be a golden age for Musk.

Wait, it doesn't change your view at all? I mean, isn't that the whole thesis, that it's not really a car company, it's more of a software company with autonomous driving? Because we were just talking about it earlier. Tesla sales down in China, I believe, down about 15%. Conversely, BYD sales up about 14%. No doubt. But Frank, to me, 90% of the future value, it's about AI. It's autonomous robotics. I do believe, Musk, you're going to see a turnaround in China stabilization, Europe as well as in the U.S., but

But what we care about, what we're really focused on is autonomous and robotics. That's how we get to a $2 trillion market cap for Tesla. I think ultimately this is a stock that could double over the next 12 to 18 months. Let's dig into some of these other names in your top AI30.

I would imagine some infrastructure companies are there. Maybe Adele's in there. So tell me if Adele's definitely in there. And also some of these cuts, again, from the federal government. Seems like a lot of federal government influence here to some of its software providers and things like that. How does that impact the thesis on some of these names? Is federal government work a meaningful source of revenue? I mean, we know it is for Palantir. Palantir has a big government business. But what about some of these other AI names as, you know, the quote-unquote modernization of the federal, you know, tech system is going on?

Yeah, and you've done, you know, obviously a lot of work in that area, too. Look, to me, the modernization is actually bullish and positive for software. So when you think about, of course, Palantir, you look at Microsoft, you look ultimately at Oracle and others. I actually view this as software. It's a positive. Now, will there be cuts in certain areas? No doubt. But everything we're seeing, I think from software to cybersecurity, you have two trillion that's going to be spent in the next three years.

government is going to continue spending more and more when it comes to AI. You talk about regulatory, everything happening. I do believe this is actually a huge net positive for software because of the use cases. And that's actually the area that the government's going to be spending on. All right. You mentioned second, third, fourth derivatives.

Yesterday, huge deal announced, Constellation Energy and Meta. Does that reshape your view maybe on how you're viewing energy names when it comes to AI and even for the IZTF? I know you can't get too much into this, but where you put energy names when it comes to top holdings? Yeah, and ACO in there is in the AI 30 relative to nuclear, the Constellation deal. Look, I think it speaks to our view. You're going to have more and more of a convergence.

big tech energy, how you fuel in the data centers. You're going to need six to eight X the power to fuel these data centers. But it's also my view, what you're seeing here, that's just tip of the iceberg. You can't just play at AI just by owning two or three names. You got to play the theme. And that's all the work that we've done around the globe to put together. It's a dynamic list in terms of the AI 30.

Really quick, we got to go. We showed your first derivatives and that board at the start, you know, NVIDIA, Microsoft. Give us your top pick when we're talking second derivatives. People are trying to get ahead of the curve. Yeah, I think, look, in turn, second derivatives, to me, it's really cybersecurity because that's where I think you're going to see more and more of the AI spent to protect the workloads. I think right now, leading on AI will be

You know, he's obviously a parent here on the software side, but you have Palo Alto, you have CyberArk, you have Zscaler, and CrowdStrike quickly coming on the AI side. All right, we've got to leave it there. Dan Ives, always a pleasure. Great to see you as always. Thank you. All right, as we head to break, we're watching shares of Warner Brothers Discovery. A majority of shareholders rejecting the pay packages of CEO David Zaslav and other top executives at the company's annual meeting.

The vote, however, it's non-binding. Shares of Warner Brothers Discovery just up right now, up about a quarter of 1%. Worldwide Exchange back in just a moment. Worldwide Exchange, we have a news alert for you. The EU's trade chief posting on X just a short time ago, he had what the trade chief is calling productive talks with U.S. trade rep Jameson Greer. The trade rep adding the talks are moving in the right direction. This is the White House reportedly pushes for countries to give their best trade offers by today.

All right. Moving on to the trading day ahead, let's bring in Sebasti Balafast, CEO of GoldFest Advisory, which manages right around $600 million in assets. Good morning. Good to see you. Good morning. Nice to see you, Frank. All right. So just got a little bit of breaking news right there. The EU trade chief saying essentially there's some progress being made. How does that shape your view of the market day ahead? The market seems to have really been trading on trade news, tariffs and, you know, pauses and no pause.

Well, I think this plays right in. I mean, it sounds positive, but to be honest, it doesn't give us a lot more information. The market has been range bound over the last couple of weeks, and part of it is because we've stalled. We're in limbo with the number of data points. So I think this sounds positive, but frankly, it doesn't give us a lot of new information to move forward. With that in mind, what's your word of the day?

Limbo. That's exactly it. So this plays right along. Limbo is the word of the day. And the reason for it, as I mentioned, is we're in limbo. We don't have enough information. We saw the international court ruling the other day on Trump tariffs. But that's going to get appealed. That's just stalling the momentum that we've seen from resilient data.

Earnings have been positive. We saw that double-digit earnings growth in the first quarter. That's been positive. The hard data is holding up and has been resilient. Soft data is coming back up, has been more positive. But again, the S&P has been range-bound. Futures are positive today, so I'm hoping we break out of that 6,000 number. But the Fed's in limbo. We're waiting to see what's going to happen. How much of an impact is inflation going to have?

on our numbers and and what about the jobs numbers we just had a positive jolts report the other day better than expected but you know we're still waiting to see what does it mean on the job picture overall. I want to get to your pick for us today we're just asking Dan Ives about second derivative AI plays you have a pick and that same area that he says is his top area for second derivatives.

Yeah, so Cloudflare is a name that we really like right now. They are benefiting from the AI and tech headwinds for sure. But the reason why we like them or a big part of the reason why we like them, 80% of their revenues are stable, subscription-based, secure.

They are growing a lot faster than their competitors. They have 25% year-over-year revenue growth, which has been positive. And they're a broad platform. It's not just cybersecurity that they're focusing on. So they help make our websites faster and more secure. But it's not only about security. We have a broader platform, which we like. All right, Savasi, your pick for us today is Cloudflare. Thank you very much. Great to see you, as always.

One quick look at futures right now. As she just mentioned, futures are in the green right now, just fractionally higher across the board. Right now, it looks like the Dow would open about 70 points higher. That does it for us. You've been listening to CNBC's Worldwide Exchange. You can always catch us live weekdays at 5 a.m. Eastern.

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