Trump vs. Powell, Record Watch, Truce in Doubt? 6/24/25
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Just hours after Israel and Iran confirm a ceasefire, reports of more missiles fired at Israel now putting that deal in doubt. Iran denies it. Israel vows to respond forcefully. Global markets, they're still higher as well as futures here in the U.S., but the latest news likely to keep investors on edge even as the S&P 500 closes in on a new all-time record high.

And Fed Chairman Jay Powell heads to Capitol Hill as President Trump keeps up the pressure to cut. It is Tuesday, June the 24th, 2025. And this is Worldwide Exchange on CNBC and streaming on CNBC+.

Good morning and thanks for being here with us. I am Frank Collins. Get to our top story in the breaking news this morning. U.S. stock futures, they are holding despite reports of a possible violation of a ceasefire between Iran and Israel just hours after it went into effect. You can see all three major indices are in the green right now. The Nasdaq actually up over 1%.

President Trump announced the deal on social media and it went into effect earlier this morning. But now Israel's reporting it has intercepted missiles from Iran. Again, Iran is denying it. And again, you can see futures still strong as investors. They watch this fast developing situation. We have global coverage this morning. NBC foreign correspondent Rafe Sanchez. He's in London with the ceasefire latest. Our Dan Murphy is standing by in Dubai with some very wild

moves in oil and Juliana Tattlebaum is in London with a look at the global market reaction. Raf, let's start with you and let's just take a step back until just a few hours ago. There were still some questions about whether Iran and Israel actually agreed to the terms of Trump's announced ceasefire.

Yeah, Frank, good morning. It's been kind of a confusing sequence of events, but it started last night, President Trump announcing that ceasefire. And then early this morning, we had first the Israeli government and the Iranians saying that they had agreed to stop fighting. The Israelis effectively claiming victory, saying that they had

sufficiently weakened Iran's nuclear program, set back its missile systems, and killed its leadership, effectively achieving their goals. The Iranians saying they were prepared to stop shooting as long as Israel and the United States did the same. We had a couple of hours of quiet

And then in just the last hour or so, the Israeli military saying that it detected intercepted missiles fired from Iran. Israel's military is calling this a severe violation of the ceasefire and saying that they will respond with force.

We are seeing on Iranian state media denials from the Iranian government that they have breached the ceasefire. So the big question, Frank, at this moment is whether this is going to lead to this fragile ceasefire unraveling altogether or whether these are just kind of teething problems in those final hours before some kind of deal goes into effect. Yeah, that is the big question for investors and actually everybody in that

whole region this morning. Thank you very much. Live from London. Turning now to the energy trade and how early morning developments between Israel and Iran are impacting the oil market that you can see here has fallen sharply over the last week. We're taking a look at WTI down double digits over the last week. Let's get over to our Dan Murphy in Dubai. Dan, good morning.

Frank, good morning to you. And to build on what Raph was saying, this could really be a turning point for the oil markets as well. What we're seeing right now is the risk premium that was built into oil last week evaporating fast with oil now sinking to two week lows and the political fallout also keeping traders on edge.

As Raf mentioned in the last hour, Israel accusing Iran of violating the ceasefire deal by firing missiles. It's a claim that Iran strongly denies. Right now, there's no official confirmation that the ceasefire has been broken. And analysts I've been speaking to say if both sides hold the line here, traders could see a return to stability in the oil market.

Remember as well, Iran's symbolic strike on the U.S. base in Qatar overnight caused no casualties, and it appeared designed to avoid triggering a massive escalation with the United States. President Trump himself called it, quote, very weak.

And that suggests that Iran's appetite to escalate in this environment is very low. So it also reduces the risks that we could see an impact inside the Strait of Hormuz, which, as you know, has really been at the center of speculation all week. So we're watching this really closely.

It appears the conflict might be calming down. But of course, traders aren't letting their guard down just yet. You really do get the sense that this is going to be a headline driven market for some time to come as we see oil prices continuing to fall here. Frank? Yes, certainly. We're watching oil prices. We were mentioning WTI also bring crude down about three and a half percent right now. Our Dan Murphy live in Dubai. Good to see you. Thank you very much.

Now turning to the markets, let's see how the stocks in Europe are reacting. Our Juliana Tattlebaum is standing by with that. Juliana, good morning. Frank, good morning. Well, it's risk on here in Europe. Equity is moving higher right from the get-go this morning and holding on to the early gains despite the back-and-forth headlines over the last hour or so. So you're seeing gains across the board. All of the major regions trading higher this morning. The Zetra DAX up more than 2%, so some pretty sizable gains at that.

We're seeing a strong demand for cyclical sectors and a little bit of weakness in the defensive part of the market, just signaling the risk on sentiment here. Airlines catching a very strong bid this morning. The airlines have been caught in the crossfires here. A combination of a closure of the airspace, a seizing of flights to and from the region, as well as the potential of higher oil prices and what that would mean for the sector.

So all of that risk now coming off the table, those risks subsiding. And in turn, we're seeing investors bid the airlines quite strongly. Air France KLM up almost 10 percent this morning. The oil majors are moving lower. They're the exception to the trade higher in Europe in lockstep with the retreat in the underlying oil price. So you can see a sizable sell off in BP shares. They're off of more than 5 percent right now. Total Energy's in shell also on the back foot.

Finally, defense names. There is a focus on defense here in Europe with the NATO summit getting underway in the Netherlands. And we are seeing a modest retreat in the defense stocks this morning. Henselt down about to 1.4 percent. Ryan Mattel off about eight tenths of a percent. We were off more earlier this morning. So some of those losses being pared back, but still the defense sector coming off.

Frank, back over to you. All right. Julianne Tattlebaum live in London. All right. Turn it back to the markets as we watch for the latest developments in the Middle East. Another check on U.S. stock futures in the green across the board. Still pretty much holding steady at the levels they were earlier. Right now, the S&P and the Dow both up about three quarters of one percent. The Nasdaq up just about one percent. Also, a check of defense stocks. Again, as Julianne mentioned, the NATO summit taking place right now. Defense is one of the key topics there.

Right now, U.S. defense stocks actually pulling back. You're seeing Lockheed Martin down about one and a half percent. RTX pulling back even more than that. L3 Harris Technologies down one and a half percent as well. And down there at the bottom of the list, you see that's Elbit Systems. That's actually an Israeli weapons manufacturer defense company pulling back about a third of a percent. I was speaking to analysts from Jefferies. They expect that to be a stock.

that benefits uh from some of these conflicts because again they're gonna have to resupply the israeli military also credo's defense another stock that they see a lot of investors are looking at right now those shares pulling back one percent as well also checking the currency markets we've seen the dollar be a safe haven the greenback moving higher on some of these global tensions

Right now, you see the dollar pulling back about a third of 1 percent. And now for the week, the dollar actually over the last week, I should say, the dollar in the red pulling back about three quarters of 1 percent. Quick check of the bond market. As we mentioned earlier, Jay Powell is going to testify on Capitol Hill later today. Sure to get a lot of questions about rate cuts after we heard Christopher Waller and other Fed officials say that they believe that we could be getting closer to a rate cut potentially in July. Right now, taking a look at Treasury yields.

The benchmark, the 10-year at 4.34. The two-year, a noticeable pullback right now at 3.83. All right, joining me now is Daniel Morris, Chief Market Strategist at BNP Paribas Asset Management. Daniel, good morning. Good to see you. Morning, likewise. Daniel, what do you make of the fact that we're seeing futures, they're higher right now, not really responding to the idea that potentially there's a break in the ceasefire? It seems like investors seem pretty confident the ceasefire will hold.

I don't know if I'd say people feel terribly confident, but there is clearly a baseline assumption in all of this that even before the announcement of the sea fire, frankly, a belief that this wouldn't escalate too far. If you looked at the reaction, even when you did see all prices move up, gold prices move up, it seemed relatively limited given to the potential that everyone worried about in terms of the consequences. And now at least that confidence does seem to be justified. And but like you watching the headlines minute to minute.

All right. Fair enough. It does seem like investors are kind of shrugging off some of this conflict, at least the idea that it would intensify even more from where it is right now. So with that in mind, let's go back to the U.S. markets. Where are you seeing opportunities at right now? The VIX has certainly declined right now. Bond yields have declined as well.

Well, overall, I mean, we're modestly overweight equity, so we see opportunity in equities more broadly. I think it's a bit more challenging now to have a high conviction view on a particular region or country. So actually, we're neutral in terms of our geographic allocation within equity. So there's kind of good news, I think, that you can talk about for a lot of markets, but not that

real divergence like you had immediately post the U.S. election when everyone was so very much overweight. U.S. equities, it seemed an obvious trade, even as we know it didn't quite work out that way. I don't think you see that level of conviction when it comes to the regional call for equities right now.

I mean, I want to, again, focus on the U.S. market, if you wouldn't mind. I mean, just with the idea that the Fed is looking to ease right now and also that these geopolitical tensions seem to be at least lessening. I mean, I think it's fair to say that we don't exactly know what's going to come up. Wouldn't that be a time to maybe invest in cyclical sectors, whether it be financials or industrials that continue to lead the market? I mean, wouldn't those be the areas you might want to put some money to work in?

I think that makes sense. Also, another that we've been looking at is U.S. small caps. So a bit along that idea, if you do see sustained growth in the U.S., you know, of course, ever since the Liberation Day announcements, the question has been whether or not growth will hold up in the face of the tariffs.

But if it does, if we see the U.S. economy holding steady, you would, for example, anticipate U.S. small caps outperforming, which they have done relative to value stocks in the U.S. There's always a question about how well small cap will do versus tech.

And more broadly, in terms of cyclicals, you know, let's not forget one of the reasons that investors were so positive on the outlook for U.S. equities post-U.S. election was partly taking tariffs into account and seeing that as an impetus for increased investment in the U.S., again, something that ultimately should benefit cyclical stocks, as you mentioned.

You know, Dan, I want to pull in that thread about the small caps. Right now, we're actually looking at the Russell futures. They're up over 1 percent, actually doing better than the Nasdaq even is right now. When we talk about small caps, we act like it's like a monolith, like it's everything's the same when we're talking about those 2000 stocks. But there's certainly different areas. There's financials in there. There's industrials in there. There's a number of other consumer facing businesses. Is there a certain portion of small caps that you see opportunities in?

It's almost to some degree what small cap isn't as opposed to what it is. So what I mean by that is if you think about your U.S. allocation even to the S&P 500, you know, the story over the last year and a half has been how much tech has driven that, you know, Mag 7 and so on. And then the dilemma I think that poses certainly for investors in Europe. I'm based in London.

is that maybe you like the outlook for U.S. equities, but if you increase your allocation to the S&P 500, you're kind of implicitly betting more on that tech call and maybe you feel you don't want to go much further on that allocation to tech.

The appeal of small cap then becomes that you can increase your exposure to U.S. growth without necessarily or without increasing your exposure to the mega cap tech. So we see it kind of that diversified access to U.S. growth. But excluding the mega cap tech is one of the key advantages of Russell of the U.S. small cap. Daniel Morris from B.P. Paribas. Great to see you as always, Daniel. Thank you very much.

All right, we've got a lot more to come here on Worldwide Exchange, including President Trump keeping the pressure on Fed Chairman Jay Powell, former Fed Vice Chair Roger Ferguson. He's here to react. Plus, record watch on Wall Street. But what about the rest of the world? We've got an expert panel coming up next. And then later, a double whammy for Tesla and its robo-taxi launch. We've got a very busy hour still ahead when Worldwide Exchange returns. Stay with us.

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Welcome back to Worldwide Exchange. Global markets and risk assets, they're rallying today around hopes for a ceasefire between Israel and Iran. That agreement now looking in question. The Nikkei and China's blue chip CSI 300 index both up more than 1%, while the Hang Seng and the MSCI Asia X Japan are both rising more than 2%. Some traders say attention may now shift toward the end of President Trump's Liberation Day tariff pause in just two weeks. Reuters reports Japan's trade negotiator is arranging his seventh visit to the U.S. for as soon as Thursday.

Joining me here in studio, Fred Newman, Chief Asia Economist and Co-Head of Global Research for Asia at HSBC. Also with us, Tim Seymour, Chief Investment Officer at Seymour Asset Management and, of course, a CNBC contributor. Gentlemen, great to have you both with us. Fred, you're here in studio. I'm going to start with you. Good morning. Thanks again for being here.

As we look at the end of these quote unquote Liberation Day tariffs pause coming up, you know, in about two weeks, even though we know it could even be longer because it's being battled in court right now. What does this all mean for emerging markets considering the other action we're seeing, the potential of a rate cut in the U.S. and then also a weakening dollar?

Well, everybody really wants to have clarity around tariffs. The earlier deal, the better. But, of course, these negotiations take time and some are progressing faster than others. But with the risk of a slow and global economy, you really want to get that clarity on tariffs because it doesn't just affect trade. It also affects investment in these markets. And so you want to get as fast to a deal as you can. All right.

Tim, coming over to you, a lot of talk about emerging markets this year. Some of them have been outperforming the U.S. And you also say they're still trading at a discount. I'm looking at your research. You say emerging markets have a 4P of about 12 times.

Yeah, look, E.M. typically is cheap to the U.S., and it certainly should be for a reason. But I think if you look at both positioning, if you look at valuations, we're at a time where, first of all, we've seen global fund flows readjust a lot of their destinations on the fact of both tariff dynamics and really just what's been going on for five to ten years in terms of diversification of both central bank flows, central bank investments, and I think some of the foreign flows that have come back as a just-

a function of really where they are going back to historical norms. So I like EM on valuation. I like EM in an environment where, as Fred indicated, I mean, the dynamics around both trade and tariffs and even the Fed over the last week coming out of last week's Fed meeting, I think, has been

I think, focused on easing than maybe they had led on to be. And this is very good for EM and EM currencies. All right. Let's talk a little bit more about EM, getting more particular about different countries. Fred, you gave us a couple of countries that you believe have the best potential. I'm going to say potential to strike trade deals. A lot of different variables when we're talking about these trade deals. You never know where these things go. Yeah.

You said they were closest, but you didn't really say that. You said it has the potential to be the closest. It's India, Vietnam, and also South Korea. If you look at the charts, since the Liberation Day tariffs back on April 2nd, South Korea, the EWY ETF, it's up more than 30%. I'm looking at the INDA and the VNM.

for Vietnam, they're both up right around six, you know, five and three quarters of one percent for the second half of the year. Again, assuming that we see some movement on these deals. Yeah. Which one of these areas has the best potential to continue moving higher and have the best second half performance?

So these three markets, I think, stand out in Asia. Is there one in particular? So Korea, for example, we see great market performance. Now, the market is assuming that the tariffs will be manageable for Korea. We still need to find out, but that's essentially the assumption. But a point that Tim also made is fund flows flowing back into EM. In Korea, for example, it's a lot of Korean retail money that actually was long U.S. equities and has now kind of shifted back.

into being long Korean equities. And we see it in other markets as well. It's money coming back into these local markets, partly saying, you know, U.S., maybe there's a bit of risk there, policy uncertainty. We're coming back into our markets. That's benefiting. There's a flow issue as well as kind of

that the terrorists being baked in already i'm gonna go to tend to talk about chinese equities but i want to come to you you actually a relation stat you said when it comes to china's g_d_p_ only about two and a half percent the g_d_p_ is imports to the u_s_ so the u_s_ isn't that influential when it comes to their economy according to a result that important still important he was two point five percent of the g_d_p_ that's all that a state but

It's not so the end of the world. But the rest of the world exports, the rest of the world from China is 12 and a half percent of China's GDP. So they worry much more about the rest of the world ultimately than about the U.S. market. Tim, coming over to you, talking about Chinese equities. Are you seeing opportunities in any particular places? We often follow the K-Web. Obviously, that's Chinese Internet stocks. Are there other parts of China that you also see as being attractive at this current state?

Well, one of the things that I think investors in the U.S. have been very concerned about is even the discussions of delisting Chinese equities and specifically some of the big China tech companies. One, I'm not going to necessarily tell you I know what Washington will do on this front, but I do think that this is a case that really doesn't help

It doesn't it first of all it only hurts us investors I think a lot of the companies like Alibaba and Tencent trade with enormous liquidity in Hong Kong I look at Alibaba and I say this is not a company that won for the people that have been very concerned about China macro

A lot of the dynamics around Alibaba and some of the other major players in China tech have really been more about corporate governance and dynamics where I think these are national champion companies that have been given essentially the tap on the shoulder that says, all right, things are OK again. They've kissed the ring. Alibaba has 35 to 40 percent of their market cap in cash. Alibaba has 35 to 40 percent of their market cap in cash.

Alibaba, I think, is well positioned in some of the same trends that have people very, you know, very overweight U.S. tech. And I think some of those are around AI and cloud. You know, AliCloud is a growing business that I think should be trading in a much higher multiple than it is. So it's some of the parts, it's earnings multiple. And I think the governance dynamics around China tech are really fascinating. So, Tim, when you say these two names are also your top picks when it comes to Chinese stocks, because I think another theme that

both of them kind of have is that they really generate the majority of their revenue inside of China. So they're not necessarily directly impacted by tariffs. They're not necessarily directed by tariffs. And I think some of the, you know, the e-commerce downplayed

Dynamics are ones that are more a measure of really relative improvement over where some of those trends are. I also frankly think that if you're thinking about exposure to China, you're also thinking about some of the regional players. And that's been discussed. Whether it's Southeast Asia, some of these markets have been, I think, under-exploited

underrepresented in U. S. portfolios I think if you look at also some of the dynamics. With I know it's somewhat counter to what's going on today and oil prices and potentially commodity prices. We go dollars been very supportive to what's been going on in. Hard and precious metals those.

Those companies that are exposed to that portion of both the Chinese demand and I think even the commodities played related to Southeast Asia are very interesting. All right. Fred Newman, Tim Seymour, great to have you both here. Tim, we're going to catch you later today on Fast Money. Thank you again to both of you. All right. Still on deck here at Worldwide Exchange. Trouble for Tesla's Robotex who roll out. We got all the details from Worldwide Exchange returns. Remember, Sarah Koontz was on our air yesterday mentioning some of those troubles that she saw on social media. We're going to talk much more about it.

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And welcome back. Let's get to some of these, the morning's other top stories. Silvana Hanau is here with that and much more. Silvana, good morning. Hey, Frank. Good morning to you. Well, we start with Starbucks saying it is not currently considering a sale of its entire China operations. The statement coming after a report by a Chinese financial magazine. The company was without disclosing where it got the information. Now, Bloomberg previously reported Starbucks kicked off the formal sale process of its China business in May.

inviting interested parties to submit answers to a list of questions by the end of last week. And we're seeing shares of Starbucks up a little over 1% in the pre-market. All right, the National Highway Traffic Safety Administration says it's contacted Tesla after reviewing online videos of robo-taxis allegedly in the wrong lane and speeding.

speeding on roads in Austin, Texas. Now, Tesla began a limited paid robo taxi service with a dozen or so cars in the city on Sunday. Now, Tesla hasn't responded to a request from Reuters for comment. Tesla is also being sued by the estates of three people killed last fall when their Model S with autopilot crashed in New Jersey. The lawsuit is seeking compensatory and

punitive damages and we're seeing shares of Tesla up close to two more than two and a half percent in the pre-market. And Meta reportedly approached AI startup Runway about a possible takeover before moving ahead with a 14 billion dollar investment in scale AI earlier this month. Now CNBC has confirmed the talks with Runway didn't get very far.

And Amazon plans to invest about $54 billion in the U.K. over the next three years to support innovation and the country's AI push. The investment also includes new fulfillment centers and delivery stations and more than 4,000 new jobs, Frank. Amazon shares right now up about one and three quarters of one percent as well. Savannah, thank you very much. We'll see you a bit later in the show. All right. Coming up here, Worldwide Exchange. President Trump says lawmakers.

They shouldn't hold back when questioning Fed Chairman Jay Powell later this morning after two FOMC members and Trump appointees speak out in favor of lowering rates sooner than later. Former Fed Vice Chair Roger Ferguson, he's here with us to weigh in. We'll be right back.

To me, the negotiations coming up are going to be difficult. They're going to be tough because what we're going to need to have is some type of enduring presence in that country, surveillance of their nuclear infrastructure. And of course, immediately, we need to find out where those missing 900 pounds of highly enriched uranium is located and get that under control as well.

That was Mark Esper, former defense secretary in the first Trump administration, laying out a potential path for negotiations with Iran at CNBC. The potential ceasefire between Israel and Iran looking at risk just hours after President Trump announced it on social media. This morning, the president is preparing to head overseas to meet with fellow NATO leaders. Welcome back to Worldwide Exchange. I'm Frank Collin. Coming up this half an hour, we're going to go live to our Steve Sedgwick. He's on the ground at that summit for more on what world leaders are telling him about the Middle East tensions.

But first, we begin with the U.S. markets and breaking news. Take a look. Futures, they're holding steady despite a possible violation of the ceasefire between Israel and Iran just a few hours after it went into effect. Take a look at U.S. stock futures. Still pretty much holding steady, as we mentioned, in the green across the board. The S&P and the Dow both up about three quarters of one percent. Looks like the Dow would open up.

about 350, 360 points higher than Nasdaq, doing the best, up just about 1% right now. So that deal announced on President Trump's true social account this morning in which he said, you can see it right here, the ceasefire is now in effect. Please do not violate it, even signs his name on there. Israeli Prime Minister Benjamin Netanyahu confirmed his country has agreed to a ceasefire with Iran.

But this morning, Israel reporting its intercepted missiles fired from Iran hours after both sides agreed to that ceasefire. Important to note, Iran is denying that claim. Again, taking a look at futures still in the green across the board. We also want to look at oil prices. We saw a sharp decline in oil yesterday. Brent and WTI both fell about 7 percent yesterday. You're seeing it right here on the chart right now. WTI pulling back about 3 percent for the week down double digits.

Also, we're going to look at another asset class we haven't talked a lot about, but it's Bitcoin really having a volatile week. Take a look at this chart. Right now, you see Bitcoin up just about 2.5%, but you're seeing some big swings to the upside, big swings to the downside, big swings to the upside. We're going to talk more about a bill in Congress when it comes to cryptocurrency coming up a bit later in the show. But right now, Bitcoin up just about 2.5%.

Our Emily Wilkins will have more on Bitcoin and that bill coming up in just a bit. And we got to look at the Treasury market again. Jay Powell testifying on Capitol Hill later today. Taking a look, the benchmark at 4.35. And very important to note, we've heard some Fed officials talk about potential cuts maybe as soon as July. We've seen the two-year, the most influenced by cuts by the Fed, pulling back quite a bit right now at 3.84. The long bond down here at 4.9. Okay.

That is your setup now. Back to the latest developments in the ongoing Middle East tensions. With the question of whether the ceasefire was already violated now in play, President Trump expected a lead for the NATO summit at The Hague in the Netherlands. Again, taking a look at some other parts of the market potentially impacted. Let's start with defense stocks, see how they're moving on these latest developments. Still in the red across the board right now, you see Lockheed Martin down about 1.5%. RTX pulling back even more than that.

L. Harris Technologies actually off of its lows of earlier, pulling back about three quarters of 1%. Also talking to Jeffries about some of the defense stocks a lot of investors are putting money in. Kratos Defense is one of them. Those shares are pulling back about 1.5%. And down here, Elbit Systems. This is an Israeli defense contractor pulling back a third of 1%. But again, Jeffries says they expect this company to see higher revenues

as Israel restocks some of its armaments. All right, with that, we want to go to our Steve Sedgwick on the ground at The Hague with much more from the NATO Summit. Steve, good morning. What's the very latest? A lot of developments over the last few hours. You were there on the ground talking to world leaders.

Yeah, absolutely. We're already getting a flavor of what's going on here as well. But look, what is really important to know about this meeting is it has been designed to keep Donald Trump happy. This meeting is being designed to keep the U.S. as the key member, the most pivotal, most important member of the North Atlantic Treaty Organization. There's just too diplomacy behind the scenes to get

the president happy with the agenda, get him happy with what's going to come out of a communique has been quite enormous. It's been done by the Secretary General Mark Rutte, who is the former Prime Minister of the Netherlands as well. He thinks he's got a commitment from his members for a 5% defence spending level going forward. Of course, the current level is 2%. Of that, it's going to be 3.5% on pure military spending and another 1.5% on, well, what

Some people are calling creative accounting, i.e. infrastructure, cyber warfare capabilities, strengthening roads so they can take tanks, lengthening airways, airlines, airfields so they can take a lot of the military hardware as well. So a lot of...

shuttle diplomacy, trying to keep everyone on board. The Spanish have said they don't want to get to 5%. They've said there are other priorities, there are other ways of being smarter about the capabilities of NATO. But they are the outliers at the moment. And I've spoken to the Dutch defence minister this morning. I was speaking to the Lithuanian foreign minister.

they believe the Spanish will come online. But nobody can look at what's going on at NATO here in 2025 without looking at the context of the last seven years. And it was in 2018 where I saw one of the most extraordinary things I've seen in terms of diplomacy. It was when the president in his first term as well lambasted the then Secretary General Jens Stoltenberg about Germany, about Germans paying billions of dollars for Russian oil, for Russian gas, and at the same time

owing America billions of dollars for defending it as well. And quite frankly, the president was probably right about that. And the Germans have finally taken that on board. The Germans now are trying to build one of the most important, biggest militaries in Europe with unending amounts of dollars and euros being spent on

getting the Bundeswehr, their Germany, up to scratch from where it was over the last 10 years. It was in a pitiful state. And actually, I think the president, Donald Trump, can take a lot of credit for actually getting Europe to spend a lot more money.

Yeah, you know, Steve, I've watched some of your reporting there. You mentioned Spain. Italy is another country that seems to be having some resistance when it comes to meeting some of these targets. And you said there's some leaders that say that they need to really make the case to voters about why this is needed. Kind of give us some more color on that. The official that said that you've got to make the case to voters because defense spending generally isn't that popular compared to social programs and other things, specifically in Europe. Yeah. Yeah.

That's a really good point. And it was Kestutis Budris, who is the foreign minister of Lithuania. And he made an extraordinary intervention. I interviewed him about it today as well, where he basically said to NATO, he said, look, why don't we open the books? Why don't we show the world and show our voters where we have the capability problems, where we don't have the air defense missiles, where we don't have the troops, where we don't have the tanks?

And I pushed back. I said, well, hang on a second. You're telling the Russians where we don't have the capability then as well. He's saying, no, no, no. The Russians already know where we don't have the capability. You can't hide Patriot missile batteries. You can't hide these surface to air missile areas and equipment as well. So the fact of the matter is we might as well tell our populations where our gaps are so they take action.

defence seriously. So they don't just worry about healthcare, they don't just worry about their medical situation, they don't just worry about the roads and hospitals as well. They worry about something which is existential and more important for European and global defence as well. So it's a very interesting viewpoint as well coming out from the Lithuanians as well. And again, it's got some sympathetic ears because then you can actually get the voters on board and perhaps they will back some of these defence measures, maybe including the Spanish.

Steve Sedgwick, pronounce that Lithuanian official's name. That's why you make the big bucks. Great to see you live from the NATO summit. Thanks again. Have a great day. All right. Turn our attention now to Capitol Hill. Federal Reserve Chairman Jay Powell testifies before the highest financial services committee for his semiannual report on monetary policy later this morning. Today's comments, they come less than a week after the latest Fed policy decision to keep interest rates on hold for a fourth straight meeting.

President Trump taking a true social early this morning ahead of the testimony, doubling down on his displeasure with Powell. Hard to read. I'm going to summarize it for you. We should be at least two to three points lower. That would save the U.S. $800 billion per year. Plus, what a difference this would make if things later changed to the negative. Increase the rate. I hope Congress really works. This is very dumb. Hardheaded person over will be paying for his incompetence for many years to come.

All right. Join me now on this and much more as Roger Ferguson, former Federal Reserve vice chairman and former TIAA CEO. And of course, he's CNBC contributor. Roger, good morning. It's great to see you. Good morning, Frank. How are you? All right. So what are you expecting from Jay Powell when he testifies on Capitol Hill today? Again, we got our Fed policy decision just a few days ago. But at the same time, we've heard a lot from Fed officials. I'm talking about Michelle Bowman, also Christopher Waller, kind of kind of edging towards the potential for a cut in July.

Look, I think Chair Powell is going to reinforce the message that he had last week, which is that there's a great deal of uncertainty. And I think he's going to say in that degree of uncertainty, it is not surprising to see a range of perspectives. And the last thing he'll say is, you know, it is probably too early to contemplate a cut.

Though, as he will have to point out, there were a number of people who thought they might get two cuts this year, but very few, I think, are going to join Chris Waller and Mickey Bowen in thinking it's going to be July. When we're looking at Israel, Iran, and potential U.S. involvement potentially beyond the strikes that already happened over the weekend, how does the Fed factor that in? I mean, there was potential for oil prices to spike. A lot of people thought they would. And instead, over the last week, I'm looking at WTI, it's down double digits.

Look, I think there are two things going on here. First, there's a general sense of uncertainty

And that the Fed has already talked about for sure as, frankly, waiting to see that clear. And then there's a very specific what happens in the region. And as you point out, thus far, fortunately, oil prices haven't spiked. I think the Fed will watch closely to see what happens. But right now, I think this is the broader set of macro uncertainties that's weighing on them. This is adding something to that. But I don't think it's becoming at this stage the pivotal point of conversation.

What about tariffs? We still don't have a resolution when it comes to the quote unquote Liberation Day tariffs. There's still not a final deal when it comes to China. So that uncertainty is still an overhang. If you're Fed officials who are, again, edging for a cut in July, does that mean that you've already decided that the majority of the impact of tariffs has already been factored in and it's kind of a speed bump that we're now over? Or how else do you think they're seeing it? Because it doesn't seem like we know the full effect yet.

Well, certainly we don't know the full effect. Chris Waller in the past has said that he expects the impact of terrorists to be very temporary. So I think he is one of those who's sort of looking past it. On the other hand, I'm not sure that's the consensus for sure. And at the last meeting, people took note of the fact that the number of people thinking no cuts this year had gone up.

And so the whole question of terrorists, I think, is being assessed differently by different members. And I think Chair Powell sort of indicated that as well.

So while Chris Waller and Mickey Bowman have started to be clear about their points of view, I'm not sure at this stage that they're speaking for the vast majority of the committee. And I think Cheryl Powell is going to have to try to point out that uncertainty still seems to be what's weighing on most people's minds and consequently a wait-and-see attitude as opposed to getting ready for a cut in July.

Roger, I want to kind of pull on some of your other area of expertise when it comes to CEOs. You're a former CEO yourself, and I know through the Business Council you do a survey with them. You're often talking to a lot of CEOs. How are they viewing the Israel-Iran conflict, U.S. involvement? How are they planning their businesses with the idea that there may be this kind of geopolitical tension out there?

Well, look, the last survey I did for the business council and the conference board showed a dramatic drop in CEO confidence. As I recall, roughly 82% thought that there might be a recession sometime in the next six months. Most of them certainly thought if there was one, it would be mild. This degree of uncertainty that is weighing on them, I think, certainly hasn't changed

very much with the geopolitical uncertainty. There's good news about what seems to be a ceasefire, but even that is a little uncertain. So look, all of this, I think, is just pointing in the same direction. The word uncertainty, I've used it many, many times because I've heard CEOs using it many times. And if one does a word cloud analysis,

of CEO descriptions of how they're feeling right now, the word uncertainty certainly is the one in the middle of the screen, largest and boldest. And none of this has helped clarify any of that uncertainties at this stage. Roger Ferguson, it's always a pleasure to see you. Thank you very much.

Coming up here on Worldwide Exchange, we're bracing for FedEx results. The key numbers to watch from the shipping giant fighting to recover from its tariff tumble. I mean, you see the chart right there. Big drop right after April. And as we head to break, we're watching shares of NVIDIA. CEO Jensen Wang beginning to sell shares of the chipmaker under a plan allowing him to unload up to $865 million worth of stock.

by the end of this year. A new SEC filing showing that Jensen Wong, he sold 100,000 shares in recent days worth more than $14 million. Shares of Nvidia right now, they're up over 1%. Worldwide Exchange, we are back in just a moment.

Welcome back to Worldwide Exchange. NASDAQ actually hitting its highs in the morning, up about 1.25%. Taking a look at the NASDAQ 100 gainers right now. You see Apple oven right there at the top of the list, up just about 4%, followed by Marvell, Micron, Tesla. Those shares up about 2.5%. AMD up about 2.5% as well. And then we have the NASDAQ 100 laggers. Diamondback Energy pulling back about 1.5%. Baker Hughes down almost 1.5%, followed by Kira Dr. Pepper, Intuitive, and Charter Communications.

Also looking at a company reporting its earnings after the bell today. FedEx reports after the bell, the stock's down just about four and a half percent since last earnings. You can see here on the chart, big drop after those April 2nd tariffs were announced. This quarter, revenues forecasted to climb by about 1%, while EPS is forecast to grow by about 8%. The big thing to watch for in this Q4 report, it's guidance for the next fiscal year. The impact of

tariffs, especially on the express air delivery business and any commentary on the growth of Chinese retailers like Xi'an and Timu. According to Deutsche Bank, that business for FedEx, it was actually a headwind for margin and profit growth. Again, FedEx reports after the bell.

All right, coming up here on Worldwide Exchange, setting key rules for crypto, new details on Washington's fresh moves around guidelines for the space. Taking a look, you see Bitcoin's up about two and a quarter percent, Ether up almost over four and a half percent. We're going to be right back after this break. Stay with us.

And welcome back to Worldwide Exchange. We're watching cryptocurrencies this morning. You can see higher across the board, Bitcoin up about two and a quarter percent, Ether up almost five percent, Solana and Litecoin both higher as well. CNBC is learning new details on what could be a major piece of legislation for this space and the definitive guidelines around it. Emily Wilkins joins us now with much more on the story. Emily, good morning.

Good morning, Frank. Well, yeah, a group of influential senators. They're set to release some early details of what is set to be the biggest crypto bill to come out of Congress this year. And CNBC got an exclusive first look. Senate Banking Chairman Tim Scott, Senator Cynthia Lummis, as well as a few more Republicans. They're releasing a framework that would basically create the rules of the road for crypto and other digital assets that give a market structure to these digital assets.

And that includes a definition of digital assets, includes when they would be regulated as a security versus a commodity, and it would also reduce regulation around the digital assets that's currently in place. Now, the framework also says there is a need for a small common sense package

of measures directed at things like preventing money laundering and sanctions evasion. Scott said in a statement that these principles will serve as an important baseline for negotiations on this bill. He said he's hopeful that his colleagues will put politics aside and provide long overdue clarity for digital asset regulation. Now, this outline comes about a week after the Senate passed a stablecoin bill with strong bipartisan support. Eighteen Democrats voted for that. Similar

That partisanship was seen in the House version of this bill, this market structure bill. It cleared two House committees last week. But right now, the path ahead isn't clear. Trump is pushing for the focus to remain on stablecoin and have the House take up the Senate bill. He said on Truth Social that the House must get it to my desk ASAP, no delays, no add-ons.

Yet House Financial Services Chairman French Hill said yesterday that he wants to move the House's stablecoin bill and the House's market structure bill together. It's on the latter one on market structure that many in the crypto industry say is actually the more important of the two. It's more wide ranging. It would impact more cryptocurrencies.

But nothing's going to happen at this point until the Trump mega bill gets a vote. But after that, certainly a lot of lawmakers are hoping to get this done. Maybe it's before the August recess and maybe by the end of the year. Frank, you know, Emily, if you don't mind, I'm going to switch gears a bit since you're mentioning the mega bill and that mega bill. Defense spending supposed to increase by about one hundred and fifty billion dollars or proposed increase by one hundred and fifty billion. That'd be a double digit increase.

now that potentially i guess it's not clear anymore potentially that the tensions between israel and iran could be lessening does that change the outlook on that spending at all you know rick it probably isn't and i say that just because that 150 billion dollars was in place a couple months ago back it was being discussed back in march back in april and the idea was to do things like helping replenishing u.s munitions that had currently uh been

depleted over the last couple of years. It included the idea of creating a golden dome-like apparatus for the U.S. But I think it happened well before this conflict really began to heat up. One of the things I'm actually kind of curious about is that if there is a ceasefire, does some of that funding go down as lawmakers look for potential cuts in this bill to make sure that it doesn't add too much to the debt?

Emily Wilkins live in D.C. Always great to see Emily. Thank you very much. All right, coming up here on Worldwide Exchange, tapping into a top energy idea. What our next guest says is a premium player in the space that stocks up more than 10% this month. The mystery chart, it is revealed. Also, be sure to read my new piece on CNBC Sport. It's about how pro athletes like my fellow Pitt grad Aaron Donald are making the transition from being an athlete to a business person. You can find it on CNBC.com. We'll be right back.

Welcome back to World Wide Exchange. Watching shares of Novo Nordisk launching its weight loss drug Wagovi in India to compete with rival Eli Lilly's own weight loss drugs. Shares of Novo, you can see they're up 1.5% of European trading and here in the U.S. up just about 2%.

One more check on U.S. stock futures in a very fluid situation in the Middle East right now. Taking a look at futures, you can see they're in the green across the board, pretty much holding steady throughout the morning. The Dow looks like it would open about 320 points higher. With the gains, we're back on Record Watch for the S&P 500 and for the Nasdaq. With that, let's bring in Patrick Frazetti, Managing Director and Partner at Rose Advisors at Hightower. Patrick, good morning. Good to see you. Let's jump into it. What's your word of the day?

Durability. I think if you don't have a durable portfolio, it's been very difficult to navigate these markets for the first half of the year. So with that in mind, you're trying to create a durable portfolio. You gave us an energy name as your pick. We just want to reveal our mystery chart. It's EOG Resources. Why is this a good buy right now? We're seeing a lot of volatility in the energy space.

It's a premium driller with a great balance sheet, good assets. They've been in West Texas for a long time. They're expanding in the Utica. I think owning some oil and gas in the portfolio, you can see just based on the environment we've been in politically, geopolitically, I think it's always worth having some exposure to oil and gas in your portfolio. And again, it's a premium name with great management and great assets.

With that in mind, though, I mean, just the decline in oil prices after, you know, the potential for a ceasefire and even the climb, to be honest, after Iran did a telegraphed attack on a U.S. base in off fairness in Qatar was telegraphed. Doesn't that reduce the potential profitability of this company?

It does in the short term. You're right. But I mean, when we look at, hey, are we in an inflationary environment? You know, what is what is global demand look like for oil and gas in the short to intermediate term? You know, in the short run, you know, again, we can we will always have volatility, you know, in this space. All right. I still like your pick for us today's EOG. Thank you very much.

All right. One more look at futures. We mentioned this morning is a very volatile situation or fluid situation, I should say. President Trump announcing a ceasefire and then there were some other accusations that was broken. We're going to toss it over to Squawk Box for much more. You've been listening to CNBC's Worldwide Exchange. You can always catch us live weekdays at 5 a.m. Eastern. At Amica Insurance, we know it's not just what's inside your home that matters. It's who you share it with. That's why we work even harder to protect it.

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