Auto Tariff Relief, Longest Win Streak, Key Consumer Report 4/29/25
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The White House easing off the pedal when it comes to the auto sector and tariffs, the move helping lift U.S. stock futures with Wall Street riding its longest daily win streak since the November election. Plus, a leading indicator for the state of the consumer, the one number that you need to watch when UPS reports its earnings later this morning. It is Tuesday, April the 29th, 2025, and this is Worldwide Exchange on CNBC.

And good Tuesday morning. Thanks so much for being here with us. I am Frank Collins. Get you ready for the trading day ahead. We begin with the U.S. markets as the S&P and the Dow, they ride a five-day win streak. It's the S&P's longest run since back in November. Taking a look right now, you can see futures. We're in the green across the board. The Dow looks like it would open up about 100 points higher. We're going to take a look at the S&P 500 leaders in the pre-market. Taking a look at those, you see Ecolab right here at the top of the list. Those shares up 100%.

Over 3.5%. TKO up about 3.5%. Hologic, Terradine, and Humana running out the best performers. We're also going to look at the laggards this morning. Taking a look at those, seeing those right now, we're seeing NXP Semiconductor.

falling more than 8% right now. PACCAR, Universal Health, Kimco Realty Corp, and SBA running out the worst performers on the S&P. Again, the biggest week of earnings this week, actually, a third of the S&P, about a third of the Dow. Today, a big focus on the consumer. Take a look at some of the stocks reporting. UPS, those shares up over a half a percent ahead of earnings. Coca-Cola, Starbucks, shares up a half a percent ahead of earnings.

Also down here, Kraft Heinz, KXKHC. Those shares up over a half a percent ahead of earnings as well. Taking a look at oil, oil falling about one and a half percent yesterday. WTIO in pace for its worst month since November of 2021. Taking a look right now.

You can see it's pulling back just about 1.5% right now. Month-to-date, pulling back more than 14%. Different story when it comes to gold, gaining 1.5% yesterday on pace for a four-month win streak. Taking a look at gold right now, you can see month-to-date it's up 5.5%. But this morning, pulling back about three-quarters of 1%. We want to look at the dollar as well on pace for its worst month since all the way back in 2010. Think of the great financial crisis those days. Right now, the dollar up fractionally.

This month, pulling back over 4.5%. We also look at bonds this morning. Bond yields pulling back as well. The benchmark right now at 4.23, just a few basis points lower than it was yesterday. Okay, that's your setup now. We want to turn our attention to Washington, D.C., and new developments in the president's global trade war backing off the throttle, at least for one key sector. NBC's Alice Barr joins us with much more on this story from Washington. Alice, good morning.

Good morning, Frank. The Trump administration is looking to focus on the economy today, with the president marking his 100th day in office with a rally in Michigan where his sweeping tariffs are hitting the auto industry hard. And as the White House aims to push back against recent polling that shows Americans largely unhappy with the president's handling of trade and tariffs, Trump officials say the president is planning to reduce some fees

on foreign auto parts for cars that are assembled in the U.S. while keeping tariffs on imported vehicles, though making a shift to keep those tariffs from stacking on top of other ones. We have a new statement from Commerce Secretary Howard Lutnick saying that this is a deal. This deal is a major victory for the president's trade policy by rewarding companies who manufacture domestically while providing

runway to manufacturers who have expressed their commitment to invest in America and expand their domestic manufacturing. The Wall Street Journal first reported on this development. Just 39 percent of Americans approve of President Trump's tariff policies, according to a new NBC News stay tuned poll. The president slammed that and a series of other recent polls showing him underwater on several key issues. That new NBC News poll has his

overall approval rating at 45 percent. And in just about three hours from now, we're set to hear from the Treasury Secretary Scott Besson. He's going to be briefing about this tariff policy after he said on CNBC that things are kind of tough in the negotiations with China. But he said it is on China to de-escalate the trade conflict. Of course, everyone watching where that's going to go, Frank.

I think we're all watching that, especially people in the markets. Alice Barr live in D.C. Alice, always great to see you. Much more on this story all day right here on CNBC, including a one-on-one with Commerce Secretary Howard Lutnick. That's coming up at 2 p.m. Eastern. Auto tariffs and a whole lot more on the agenda. All right, from D.C. to London, earnings season kicking into high gear. Our Steve Sedgwick, he's standing by with some of the movers this morning. Steve, good morning. Good to see you. New set over there in Europe. How are things?

Yeah, thank you very much indeed. Well, it's all about developing the muscle memory on the new set. But yeah, we're doing pretty well, we think. Look, very interesting. If you look over my shoulder, you see two thirds, maybe three quarters of stocks in the green. You'd think actually that was a real boost for these equity markets at the start of the earnings season if more stocks are up aggressively than down. But take a look at London. Take a look at the cat car on over in France as well. London especially really struggling because two of the biggest names,

On both sides of the Atlantic, BP and AstraZeneca really struggling to make any traction after their latest numbers. And BP, of course, in the firing line for a potential activist from the likes of New York-based Elliott as well, which owns 5%. They're trying to close the gap between the valuation of Exxon at 15 times forward and its own, which is just sub 10 times. Anyway, what do they do? They posted a net profit of almost $1.4 billion.

billion for the first quarter. That was actually below analysts' estimates and down by almost half on the year. Now, they can't do much about the underlying oil price, but the beleaguered energy giant bought back three quarters of a billion shares at the lower end of some of its guidance. And that's amid, of course, that pressure from activist Elliott to cut costs more aggressively, cut the capex more aggressively, get the debt down and increase

returns. Let's take a look at Deutsche Bank as well, because these were really big numbers. The shares, look at that, year-to-date up 36%. They're also rallying a little bit in today's session. They posted a 39% jump in first quarter pre-tax profit. The German lender also reported a

a 22% increase in investment banking profits. That's coming from volatile markets, of course. Also flagging uncertainties in the macroeconomic environment and set aside nearly half a billion dollars in provisions for credit losses this year. Back to you, my friend. Steve Sedgwick, live in London. Great to see you as always, Steve. Thank you very much.

All right, we are following President Trump's 100th day in office, a period that so far has been bad for stocks. The S&P is down 7.8 percent since the inauguration, the worst performance during a president's first 100 days since Richard Nixon's second term in office when it fell nearly 10 percent. Historically, the markets have recovered over the rest of a president's term. But according to Barron's, going back to 1949, during the seven times stocks were down during a president's first 100 days, the average return during their four-year term was just over 20 percent.

where markets have been up during those first 100 days. The average return is a whopping 53%. Joining me now is Kate Elhillo, president and CIO at Russell Investments. Kate, good morning. Thanks for joining us. Hey, great to be here. All right, so as we're looking at these 100 days for the president, obviously we all know what the stock performance is. We've seen the markets under quite a bit of pressure. A lot of that's due to tariffs. What do you see as the outlook for the rest of this term?

Yeah, well, I'd say the one good thing you'd look at is this bounce back that we've seen. It's a little bit more of a broadening out in the markets. And so if you look into the second half of the year, hopefully we start to get a little more certainty on tariffs. We've seen whether it's some concessions on autos or other things, hopefully some deals come through.

And you can hopefully move kind of beyond the tariff policy into tax deregulation, some of the things we had hoped to see kind of coming into the year. But I do think it has, you know, you positioned a bit more defensively in the current market and then looking out into the rest of the year before you start leaning into more cyclicals. Okay. What do you think about the defensive trade? Today we have a number of consumer-focused stocks. One of them is Kraft Heinz, a defensive name. Just last week they had a pretty rough week. What's your view on that so-called defensive trade?

Yeah, I mean, a lot of it has played out and I think some trimming was needed after you've seen kind of that big bounce. But it is a safe place to be. I mean, we would focus on diversification across the portfolio. But if you look at some of the good secular trends around power and energy and utilities, there still seem to be places that you can find some safe harbor during this period.

Another area a lot of people are looking at is the consumer stocks that have direct exposure to the consumer. Obviously, some of the big tech names have been under pressure. They've been trading lower because there's growth concerns. But today we get a number of companies. Starbucks is one direct exposure to the consumer. UPS, a big part of their business is consumer focused. How are you viewing those names?

- Yeah, well I think it's gonna be tough 'cause Q1 is still probably gonna look pretty solid. So it's looking into where the forecasts are and the expectations going in through the rest of the year. But if you look at consumer, what they're spending, it still seems to be pretty solid. Labor hasn't kind of pulled off yet. And so it's gonna be important to see if we get actually some guidance.

Another you like is international stocks, specifically Europe. So we're going to show right now how the S&P and the stock 600 are performing since the inauguration. Obviously, kind of a change in trade policy and a lot of other changes since then. I'm looking at the stocks 600 up fractionally right now, the S&P down over seven and a half percent. I do want to ask, would you still put money into Europe even though we don't have a trade deal yet?

And there's potential for more just trade uncertainty, trade tensions between the U.S. and Europe. And I would think that Europe would be more negatively impacted. Yeah, no, it's totally fair. But I think you'd also say that there's been over allocation to the U.S. for various reasons over the past decade. And we've seen some money flow already into Europe. So some of that trade has already started. But you've got maybe easing is a little bit more.

kind of expected and known to get some fiscal spending coming out of Germany. And we've seen it through the defensive, as you might see some infrastructure and other spending start to help Europe. And it's still from a valuation perspective under the U.S. And so, again, a theme of diversification outside of the U.S. And we think that Europe, even if you start to see some slowdown persist, that it's still a good place to be allocating.

All right, Kate Elhello, great to have you here. Thank you very much. You have a great day. All right, a lot more to come here on Worldwide Exchange, including a check on one of the worst performing sectors since President Trump retook the White House. Old National CEO Jim Ryan, he's here. Plus, adding to the semi-sector slide, what NXP just told investors and analysts that had his stock sinking ahead of the opening, you can see shares are down more than 8%.

And later, the head of the world's largest sovereign wealth fund speaks out on what he sees is the biggest risk to the markets this year and beyond. A very busy hour still ahead when Worldwide Exchange returns. Stay with us.

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Welcome back to Worldwide Exchange. Shares of Old National, they're up about 4% over the past week since the bank reported first quarter results. Earnings and revenue beating forecast driven by solid loan growth and deposit growth and an improved capital position. The company did note potential challenges in maintaining that momentum due to trade and economic uncertainty and competitive pressure in the commercial real estate market. Joining me now, Jim Ryan, chairman and CEO of Old National. Jim, good morning. It's always good to see you.

Good morning, Frank. So great to be with you today. So, Jim, we always love to have you because you give us a great read on what's going on in the Chicagoland area and the Midwest in general. I want to go back to your results from earnings about a week ago. What drove that loan growth that we were just talking about right there? What kind of loans are you seeing grow?

We are actually, it was mixed between both commercial industrial loans and commercial real estate loans. Pipelines are actually up meaningfully year over year. So I would describe earnings reports for not only Old National, but for the industry as cautiously optimistic.

You know, despite all of the headlines that are out there that are fairly negative, clients were still wanting to do business and still, you know, asking for borrowing. So I think for our industry, it was a relatively strong quarter. I mean, a little bit weaker than we would have anticipated when we started the year, but a relatively good quarter nonetheless. All right. So relatively good. Are you saying it's relatively good just because of some of the uncertainty from tariffs, from trade, the fears of an economic slowdown? Or was there something else?

No, I think it was relatively good. You know, I think the other thing that the industry was able to do, and Old National certainly did the same, is we controlled our costs, right? So that's one thing you focus on. And we were able to manage our margin through lowering our deposit costs. So all of that across the board for Old National was strong, and the industry as well. All right.

All right. So you mentioned that you were optimistic about what's going on, but also cautious. So I'm just looking at your provision for credit losses year over year. That increased quite significantly, up 66 percent. Why did you make such an increase when it comes to those provisions?

Well, our forecast for our provisions are driven by future economic activity. And so I think we're taking into account, you know, given that uncertainty, given the global trade, that's likely impact. We went ahead this quarter and took some extra reserve based on that. So we are anticipating that future forecast will show a little bit weaker. And therefore, we wanted to go ahead and provide up front. Where are you expecting that weakness? Is there one part of your business in particular that you're expecting to see that weakness?

You know, we're watching, obviously, anybody that does an international trade, anybody that's going to be affected by the tariffs. The agricultural sector is another sector, you know, we're concerned about. They're having a really tough year. The good news is the agricultural sector is really used to it. They're coming in with really strong balance sheets today. But nonetheless, there is softness this year that we're concerned about. All right.

At the same time, as you're worried about some softness coming up later this year, you're trying to grow. Actually, you're expecting a deal to close maybe even later this week. The acquisition of Bremer Bank, it's a private bank up in like the Minneapolis area that you're acquiring. What's the goal there? I mean, there's a lot of talk about M&A and the banking sector under the Trump administration. Did you see looser regulations? Is that what gave you the confidence to do this and keep going forward with it? What's the goal and what's the outlook with this acquisition?

Yeah great great question Frank for us this is really about building scale and density in markets we care deeply about- any upper Midwest the Twin Cities specifically it takes us into North Dakota which is a new market force and builds more scale and density Wisconsin this is a great opportunity great timing from our perspective I think

I would say that the regulations really haven't changed. I would say that the conversations are healthy and constructive, but it's the same regulations that apply today. Again, we were really blessed to be able to get pretty quick approval as we have with our other partnerships. And so for us, this is just a...

continuation of what we've been really good at, which is finding great partners, going into those communities, bringing the types of services that we're so known for, that passion for our communities, that passion to serve our clients. And this is really a nice extension of that. $16 million of total assets for us and the Twin Cities, bringing us to number three.

and total market share. So just really a strong opportunity for us. All right, Jim Ryan, CEO of Old National. Always good to see you. And Jim, before you even ask, I'm not taking the polar plunge with you in January. Come on, Frank. I'm not doing it, man. Great to see you as always, man. Have a great day. Thank you, sir. All right, still on deck here on Worldwide Exchange. Comments from the head of the world's largest sovereign wealth fund and where he sees long-term value during these uncertain times. Stay with us.

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And welcome back to Worldwide Exchange. Time now for your big money movers. We're going to start off with shares of NXP. We were shown this earlier, a worst performer on the S&P in the pre-market. Shares of the chipmaker, they're falling as it reports lower first quarter profit and sales and sees further revenue declines this quarter. The company citing direct and indirect effects of tariffs. NXP also announcing CEO Kurt Sievers will retire later this year. He's led this company since 2020. Shares of NXP down just about 8%.

Microsoft President Brad Smith says the U.S. cannot afford to fall behind China when it comes to quantum computing. In a letter, Smith writing President Trump and the federal government need to prioritize funding for research or risk endangering economic competitiveness and security. He's also calling on the White House to buy more quantum related computer parts to build a U.S. supply chain. Microsoft announced its latest quantum chip back in February.

Leggett and Platt reporting better than expected first quarter earnings while revenue was in line with estimates sales of betting products. They fell due to softer demand in the U.S. and in Europe. The maker of home and automotive goods says headwinds for its U.S. betting business. They could be offset by benefits from steel related tariffs. Shares of Leggett and Platt, they're up almost 15 percent in the pre-market right now. Big spike, as you can see.

All right. David Solomon, Dina Friedman and more descending on Oslo this week for the Norwegian Southern Wealth Fund's annual investment conference. And that's where we find CNBC's own Carolyn Roth and a first on CNBC interview with the keynote speaker. Carolyn, good morning. Good to see you.

Good morning to you, Frank. I got the chance to sit down with Nikolai Tangen, who's the CEO of one of the world's biggest sovereign wealth funds worth 1.7 trillion U.S. dollars. Now, in the first quarter, though, Frank, they racked up a pretty big loss, even for their standards, worth $40 billion. Why? Because of their heavy exposure to the

to U.S. assets and by extension U.S. mega caps. So I asked him, I asked Nikolai Tangen whether they were making any small changes to their U.S. asset allocation as a result of Trump's trade policies.

We have roughly half the assets in the States. We think that's a great place to be invested, both in Treasury and in the large companies. And we think the U.S. has got really fantastic technology companies, and we have made a lot of money, and we continue to be invested. The strange thing is you go back three months, and everybody were super optimistic about the U.S. and very negative about Europe.

Nikolai Tangen also sounding off on AI. He sees all this continued spending by the hyperscalers. Of course, he's very much exposed to all these tech names and he sees the efficiency gains even within his own business. Frank.

Yeah, Carolyn, Norges Bank, one of the biggest investors in a number of tech names, the Mag7 especially. Did he say anything about going forward, how he viewed these names, especially during this earnings season? If the company or not the company, but the Southern Wealth Fund, would it continue to invest in these names? Is it looking to diversify a bit away from maybe the Mag7, maybe some other parts of tech or just tech overall?

So this is not the active manager you typically think of because they're pretty much following an index. So, of course, by default, they have to stay invested in the tech names. But again, I asked him about his confidence in these tech names and he said, yes, absolutely. We see the efficiency gains even within our own company. And he sees that continuing.

across the space. I also asked him where in the world, in the financial markets, he sees value right now. And he actually, Frank, gave me a pretty sobering answer. He says, this is a very strange cocktail. You have like a world war, you have a cold war, you have a tech war, you have a trade war. So this is one of the strangest cocktails, he says, that he's ever seen. Back over to you. I think a lot of big investors would say the same thing. Carolyn Roth, great reporting as always. Great to see you and beautiful live shot. Look at that background. Have

Have a great day. All right, coming up, the case of USA dominance and what the Trump administration just did that my next guest says could help China advance to number one. We're going to be right back with that and much more. Together, these world-leading technology giants are announcing the formation of Stargate. So put that name down in your books because I think you're going to hear a lot about it in the future. A new American company that will invest $500 billion at least in

in AI infrastructure in the United States and very quickly moving very rapidly creating over 100,000 American jobs almost immediately. That was President Trump on his second day back in office announcing Stargate, the half a trillion dollar project to help fuel AI innovation here in America.

Since then, the technology has not seen as much attention from the White House as China continues to invest heavily in its homegrown leaders in that space. Welcome back to Worldwide Exchange. I'm Frank Holland. All right, we're going to come up, begin with the U.S. markets right now, get you ready for this trading day ahead.

We begin with the S&P and the Dow, both of them riding a five-day win streak. Taking a look at futures this morning, you can see we're higher across the board. The Dow looks like it would open up nearly 100 points higher, just a bit off of its highs of earlier today. We're also going to take a look at the NASDAQ 100. Leaders and laggards. We start with the leaders.

Taking a look at the leaders first, we see PayPal right here at the top of the list. Those shares up about 1.1%. Keurig Dr. Pepper, defensive trade. We're going to be talking a lot more about the consumer throughout this day. A lot of earnings focused on the consumer today, including Krap Heinz. You can see both of these stocks up over 1%. GE Healthcare Technologies, those shares up nearly 1%. Right down here, Tesla. We were talking about some of that Chinese technology advancements.

Tesla facing a lot of competition from BYD, but right now those shares up over three quarters of 1%. We also want to look at the NASDAQ 100 laggards this morning. Taking a look at those right here. NXP Semiconductor after earnings falling more than 8%, I believe, hitting their lows of this morning. PACCAR AstraZeneca also off of earnings, falling 2.5% on Semiconductor and Microchip Tech.

All the worst performers on the NASDAQ 100 right now in the pre-market. A lot of chip names here on this board. We also want to look at the Russell. It's riding a five-day win streak. Taking a look at the moves in the pre-market right now. Looking at the Russell futures. You can see right now the Russell up fractionally right now. This week, the Russell, the small caps, they're up about 4%. So a strong week for the small caps as we're looking at Trump's 100 days in office right now.

And as I just mentioned, big day for the consumer today. A lot of earnings from companies really focused on the consumer. Right here at the top of the list, you're going to see UPS. We're going to talk more about that in just a second with Ken Hexter from Bank of America. You can see shares of UPS up over a half a percent. Speaking of the defensive trade, another staple right here, Coca-Cola, pretty much flat in the pre-market. Starbucks also with earnings.

Those shares up about a half a percent down here. Kraft Heinz previously mentioned shares up over one percent right now. Want to take a look at what's been a defensive trade, kind of that safe haven gold up about one and a half percent yesterday, actually on pace for a four month win streak. Take a look at gold in the pre-market, however, pulling back a bit down more than a half a percent. But you can see right here, month to date up over five and a half percent dollar. Bit of a different story. Dollar on pace for its worst month since August.

all the way back in 2010. Taking a look at the dollar in the pre-market, however, up fractionally. Month to date, the dollar pulling back nearly 5%. Also looking at bond yields right now. Bond yields falling just a bit from the levels that we saw yesterday. The benchmark at 4.23, pulling back just a basis point or two from the levels that we saw yesterday.

All right, time now for your morning call sheet. UBS cutting its price target on Amazon from $2.72 down to $2.53. The bank says it's taking a conservative stance ahead of earnings due to potential tariff-related demand destruction. Taking a look at shares of Amazon right now in the pre-market. Those shares up just about a half a percent. Also looking at Bernstein cutting Reddit's price target from $1.50 down to $1.10. It cites recent softness around the site's app download and concerns around app spending. Taking a look at shares of Reddit. They're up just about a half a percent right now.

All right. As we head to break, CNBC is celebrating 20 years of Jim Cramer's mad money with a special look back at the show's two decade long run. That's tonight at 7 p.m. Eastern, only right here on CNBC. We'll be right back after this. And welcome back to Worldwide Exchange. I'm now for your global briefing. Canadian Prime Minister Mark Carney's Liberal Party has won that country's federal election. In his speech, Carney accused President Trump of trying to break Canada so America can own the country. Adding the old relationship with the U.S. is now over.

Alibaba rolling out a new version of its own QQN AI model. The Chinese tech giant says the model rivals DeepSeek's performance on several fronts. And a number of stocks on the move in Europe. That includes HSBC launching a $3 billion share buyback after reporting a 25% profit drop, warning of a possible hit due to President Trump's tariffs.

Adidas confirming its own outlook, but warning of higher costs from those tariffs. Deutsche Bank posting a 39% jump in profit, its highest in 14 years, but also stressing the impact of tariffs. And Novartis raising its forecast after profit-topped estimates. BP also reporting a nearly 50% drop on weaker oil prices.

All right, turning to UPS. Earnings before the bill today, I should say. Shares have fallen more than 25% over the last three months as concerns about the consumer and the economy, largely due to tariffs. They've weighed on the stock. This quarter's revenue is expected to remain basically flat, while EPS is expected to decline slightly. The key metric to watch will be the company's U.S. domestic package business. It generates roughly two-thirds of revenue, but is also seen as a barometer for the U.S. consumer when it comes to spending. Margin for this business is also closely watched today.

as a sign of efficiency in the UPS network that the company has been working to, quote-unquote, right-size. Joining us now to discuss UPS and other transport earnings this week is Ken Hexter, research analyst at B of A Securities. Ken, good morning. Great to see you. Good morning, Frank. Always a pleasure. So what are your expectations for UPS? I mean, I was highlighting the U.S. domestic package business. That includes, you know, e-commerce and things like that. What are you looking for in this result?

Great question. So, you know, we're going to see results in an hour, but I think really what we're concerned with is you had planned for the process. They're about to give up 50 percent of Amazon's business, right? So you've got about $11 billion worth of revenues. You're going to work about half of that off over the next six quarters. So they had planned to shrink the network around that. They also have an adoption of some U.S. Postal Service business that they had on their network.

They're absorbing 100 percent of that into their network. So we're looking at that conversion as well. So they planned expenses around that. So while that was going on, you then have this other dynamic of the tariffs and

and decelerating business in the first quarter. You had some weather events early on. I think they adjusted to the weather maybe in January. But then as February and March got along and we started seeing the impact of tariffs, you now had volumes come in a little bit more. So we were expecting a below consensus report as they get set to report this morning. Ken, on Friday, I was filling on another show, the Halftime Report, and we were looking at SIA.

A 30 percent jump, I mean jump, a drop on Friday after earnings, citing some macro uncertainty, saw a big decline when it came to revenues. A lot of people are wondering, is that a read through to some of the other transport stocks? Is it a read through to UPS? Is it a read through to C.H. Robinson that reports this week biggest freight mover from Asia to the U.S.? Is it a read into XBO, another LTL trucker?

I certainly think there's concern amongst the less than truckload trucking companies. So the LTL companies like you mentioned, XPO and Old Dominion, that as we have moved past the yellow bankruptcy, we're a year beyond it, but we're still within the freight recession. There was concern about pricing and SIA had some

some negative yields sequentially. And that kind of brought up the concern that, wow, maybe there is some price competition going on among some of the businesses to win some share while we're still in this great recession. That took a sizable hit to SIA. And I think that there's certainly concern with those that are left. We did not see it to that same extent at Old Dominion, the leader that is still focused on pricing. But we do see it at the bottom end of the group. Some other companies within the world that are seeing a little bit of price increase

chasing in order to win some volumes in this very weak economic backdrop. You mentioned C. H. Robinson completely different company there you're looking at somebody who can actually take advantage of low spot prices so C. H. Robinson is a freight broker that means they don't own the trucks they use other people's trucks and so when they're buying on the spot price. And they've got contracts with customers that means they're finding assets that are cheaper to use and C. H. Robinson can actually take advantage of that you could see.

some boost to those margins as they're able to buy capacity for a cheaper price. Can I ask you about the transport space going forward? We continue to see these reports of containers coming to the U.S., slowing down very dramatically. After this quarter, what is your outlook when it comes to transport stocks? Of course, they really rely on that freight coming in, not only from Asia, but other parts of the world, and tariffs seems to be disrupting that flow. Well, one thing you and I have always talked about, Frank, is that we don't make anything. We just move it within transportation and

And certainly you're seeing a lot less move. As you know, we do a truck shipper survey every two weeks and it is broken below 50 levels. It hasn't broken aside from once for two years. That's a big concern, right? That's a signal of what shippers expect economic activity going forward. As you mentioned, the port data coming from China is down anywhere from 40 to 60 percent based on the week.

That means in three, four sailing weeks when it gets here in mid-May, we're going to see, I think, a huge pocket of freight. So we need to set policy, right? Once we get some policy set, and I think trade resumes, but in the interim, you're certainly seeing some of that lack of volume moving. And that is concerning for freight shippers like the rails trucks and some of the others that move that freight inland.

becomes an increasing concern. All right. But first things first, as you mentioned, UPS reports in just about an hour, shares up over a half a percent. Ken Hexter, always a pleasure. You have a great day. Thanks, Frank. Have a good morning. And tomorrow, Worldwide Exchange, we're talking more transports in the broader American economy under the first 100 days of President Trump in his second term. We're going to talk with CSX CEO Joseph Heinrichs. That's coming up at 530 a.m. Eastern. It's going to be a very deep conversation about what he's seeing from his customers and the economy overall.

All right. Coming up here on Worldwide Exchange, we've got the one word that every investor has to hear today and the stock pick that every investor needs to know. Plus, President Trump's AI ambitions, the moves our next guest says the White House needs to make to meet its very lofty goals. We'll be right back after this. Stay with us.

All right, welcome back to Worldwide Exchange. We are turning to D.C. and President Trump's first 100 days back in office. The White House backtracking once again on its hardline tariff stance, offering new relief for automakers by eliminating certain duties on foreign parts for cars made in the U.S. and also offering to reimburse companies for some tariffs that have already been paid. The move helping to ease will spend a rough 100 days for the auto sector. GM, Ford, Tesla and Stellantis all higher ahead of the open, but are all still down sharply since January the 21st.

And while automakers, they've been playing defense, others in the AI space like SoftBank CEO Masa-san and media chief Jensen Wong, they've been both doing their best to stay on the president's good side. The two reportedly among a group of CEOs that are going to visit the White House tomorrow to highlight U.S. investments they've announced since the president returned.

And then there's AI defense giant Palantir. While the rest of the markets have been on a roller coaster ride over the past 100 days, Palantir has continued its run up higher and is the top performing S&P 500 stock since inauguration day. Let's talk more about this and the state of AI in Trump's D.C. Let's bring in Malo Santo, CEO, XIEX. Good morning. Thanks for joining us.

Good morning, Frank. Thank you so much for having me. It's an honor to be here this morning. Always a pleasure to have you. So just give us your general take. First 100 days when we're talking about AI, we started those 100 days pretty much with that Stargate announcement. How have you viewed how the Trump administration has looked at AI since then?

I think it comes back to the first conversation that we had about AI and regulation under this administration, where we're seeing a very different approach, where this is an administration that is pushing a more hands-off approach in terms of regulation, where it's looking for market corrections.

by the market itself as opposed to looking at the technology and trying to engage it and address it before it goes to market. The administration has rolled back a number of safety administration goals and policy intentions to be able to regulate the technology, claiming that things like AI safety

and AI responsibility are inherently bad for innovation. And I think what we're seeing here now is which methodology will be able to win the long-term AI race, right? Right now we're in a back and forth of who's competing for the number one spot, but the long-term spot

will be to people who can build AI that is of quality, meaning that it works well for a number of users over a number of use cases and AI that is reliable, meaning that you can use it in a number of situations. So it'll be interesting to see how technologies are able to push that innovation forward under the new administration's more hands-off approach versus the previous administration under President Biden. So you're saying this word innovation. You're also talking about the AI race.

between U.S. and China. So can you give us an answer? We keep talking about this. Who's in the lead right now? How big is that lead? I talked to some experts. They say the lead is as small as six weeks. Other people think that we know we're years ahead of China. Where do you think we're at?

I think that right now the U.S. is in the lead and will continue to remain in the lead for the foreseeable future. As mentioned last time we spoke with the DeepSeek Innovation, the U.S. did see a setback with hardware development and being able to develop more efficient, more powerful models using their hardware resources more efficiently. However, now that the U.S. has started to pick up on some of those new techniques and put them into their models,

Our models are shooting forward ahead of China at rates that are unprecedented. Now, I want to caution that to the everyday consumer or to the everyday business person, it may not feel like that because you're going to see a lot of videos coming out of China where AI is being adopted in everyday life faster. Some of you all may have seen the recent robot marathon that they held.

Maybe turning on AI faster, you know, at the speed of innovation in everyday life might seem like the correct answer. That doesn't mean that deploying it more quickly means that deploying the AI means that they're better at deploying AI than us. Americans have a different quality for the standard of artificial intelligence that we put out. We wouldn't just allow anyone to go and code an artificial intelligence in their basement and be able to turn it on, let's say, for example, on a real patient or have it actually go into a person's home and become an assistant.

And so it may take us a little bit longer to see some of these applications become more everyday versus the way that we're seeing the rate of adoption inside of China. However, I firmly believe the United States is in the lead and will continue to be so in the foreseeable future, so long as we focus on reliability and on quality as two long-term values underpinning our approach to developing AI. All right, so I think a lot of people are going to be relieved you see us in the lead. I want to ask you about some recent headlines.

Time magazine had an article yesterday. It was an exclusive that they posted. The headline here was Trump pushes out AI experts hired by Biden. You and I talked yesterday. You say you actually know a few of the people who have been pushed out. So what's the short term impact and also what's the long term impact when it comes to the federal government being able to get the brightest minds when it comes to AI after this?

100 percent. I mean, unfortunately, some of my friends were among those people who were rolled back out of the federal government. And for those who aren't aware, those folks who were referring to in that article are the folks who were specifically headhunted by the federal government to leave the private sector and come and bring their knowledge and wisdom into the public sector, into the federal government to help various agencies figure out how to adopt artificial intelligence. Recently, all of those hires have been rolled back and released and

told to go back into industry. Now, I think that this new administration, as much as they want to have a hands-off approach to maybe putting rules around this technology, need to have a hands-on approach to cultivating the minds behind the technology. And unfortunately, we are in a very, very hyper-competitive society when it comes to getting intellectual talent for artificial intelligence, where you already have people graduating with PhDs from Stanford or from my alma mater, UC Berkeley, with

you know, offers for seven, $800,000 a year entry level at these, you know, computer science companies, these tech companies, or they can go make 70 to $75,000 a year for our federal government. And so either the incentives on the government side need to match from an economic perspective, or we need to be a little bit more gentle with how we handle that talent, given the type of

personal monetary sacrifice we're asking them to make so that they aren't attracted to, you know, only provide their brainpower to industry, but to move our country forward together, as well as not groups of folks that end up getting bribed by external adversaries. So, Axe, I got to ask you one last question. We got to get out of here. You gave us the top two U.S. companies, public and private, when it comes to AI. You say it's Microsoft and Anthropo.

If you were in the White House, if you joined the administration, what policies would you implement or suggest to kind of help these companies keep in the lead? You said the U.S. is in the lead and just improve the quality. You kept saying the word quality of A.I. here in the U.S.,

100%. I think that if we take away all of the political language around bias, around fairness in AI, there is a real challenge around the quality of these algorithms that are being deployed. And if there is one policy that I would push for, if I were a part of this administration, it would be to ensure that the algorithms that we turn on are of enough high quality to actually be used to affect human lives. For example, earlier I mentioned that we wouldn't allow

you know, just any coder to go into their basement and make an algorithm that could tell you whether or not you were healthy. So we shouldn't be allowing that to happen in our markets today, which is unfortunately because of the regulatory landscape possible that somebody could very well build an algorithm in their basement, sell it to a medical company who would turn it on on you

making decisions about your health care without it ever having to go through any sort of bird certification or any sort of testing or compliance. And I think that that's a critical flaw. I think that we don't let humans do that. I don't let someone who watched a bunch of YouTube videos go and then go do surgery on me. We have board certifications. So ensuring that the AI meets at the very least the human standards of quality that we put out for folks to be able to

engage with other humans in certain fields. There are certain certifications we have, and I think we need to make sure these technologies have that certification as well. Exciting. Always appreciate your time, your insight, your thoughtfulness when it comes to this topic. Thank you again for being here with us.

Likewise. All right. Coming up here, Worldwide Exchange, finding protection in the defensive sector. The stock in the red following its latest earnings, our next guest says, is a top buy. And if you haven't already, you should follow our podcast. If you miss Worldwide Exchange, check us out on Apple, Spotify or other apps. And we'll be right back after this.

And welcome back. As we close in on the 6 a.m. hour is a check of a few big stories that we were following this morning. A group of banks, including Morgan Stanley, Bank of America and Barclays, have sold the final piece of debt tied to Elon Musk and his 2022 buyout of Twitter. That's according to multiple reports. Musk involvement with President Trump has fueled investor interest in the platform and has raised its value.

Amazon launching the first batch of its internet satellites into space after an earlier attempt was canceled due to weather. Once up and running, the project will compete directly with SpaceX's Starlink.

Shares of Universal Health Services under pressure ahead of the open following first quarter results, revenue missing analysts' expectations, while earnings, they beat the street. And Uber raising its in-office requirements for employees from two days to three days a week, according to a memo seen by CNBC. Uber saying that will include some workers who were previously approved for remote work. That new policy takes effect in June.

And breaking just moments ago, the Wall Street Journal reporting Merck is planning to spend $1 billion on a new factory here in the U.S. to make supplies of its blockbuster cancer drug, Keytruda. Taking a look at shares of Merck right now, they're just fractionally higher. But again, news just broke just a short time ago.

All right, turning back to the markets, the Dow and the S&P riding five-session win streaks. First time since late last year. Taking a look at futures right now. You can see we're in the green across the board. Believe the Dow hitting its highs this morning. The S&P and the Nasdaq higher as well. For more on the trading day ahead, let's bring in Kevin Mahn, president and CIO of Hennion & Walsh Asset Management. Kevin, good morning. Thanks for joining us. Good morning, Frank. My pleasure. Starting off, word of the day. What are you thinking? Yes.

perspective. And I know it's hard for investors to keep their perspective during these periods of heightened volatility and all the uncertainty that continues to percolate in the markets. But investors should try and avoid the temptation to try and time the market and make a short-term investment decision that has long-term investment consequences. And here's a dose of that perspective. Over the last 20 years, had investors just

missed out on the seven of the 10 best days in the market. They generally occur within two weeks of the 10 worst days. Interesting, right? Yeah. So if you try and time the market and sit on the sidelines, you're likely to miss out on the most significant returns that the stock market has to offer.

So keep these periods of volatility in perspective, but also look to some of those underlying themes that were taking place and building momentum before the tariffs were announced. And I believe will continue to provide growth opportunities for years to come. I got to be honest, Kevin, it's hard to think of anything before the tariffs were announced.

We've seen a lot of volatility since then. It seems more like we're looking forward right now. So two big things coming up tomorrow. We get the GDP and we also get PCE. I'm looking at the numbers. GDP is expected to fall off a cliff. 2.4 in Q4, down to 0.4 for Q1. And then also PCE, also expected to decline, but not off a cliff. I think a lot of people would like it to fall off a cliff. This is headline right here, 2.5 down to 2.2. What does this all mean?

I think it just reiterates that the Fed is more concerned with a slowing economy than they are with an inflation scare posed by these tariffs. If you look at their own forecast for GDP growth this year, they lowered them to 1.7%. They believe it's going to stay below 2% even next year.

However, when they raise their forecast for inflation to 2.8%, they believe that's going to come back to 2.2% next year. That's because higher prices force the consumer to spend less. If the consumer spends less, given that the consumer spending accounts for 70% economic growth, the economy can only slow further. That's why, Frank, I believe, and I'll say it here on the show, a potential first rate cut at 25 basis points may take place later this quarter after their June meeting.

All right, Kevin, we're running out of time a bit. I want to get to your pick. It's RTX, defense name. I do want to ask you, why buy this now? It's actually down since earnings. What's giving you the confidence to buy it now if they're having their own questions about tariffs, supply chain and everything else? Yeah, President Trump announced they're going to increase military spending to $1 trillion next year, a 12% increase over last year. He keeps speaking about building an Iron Dome.

Well, guess what? Raytheon, or now RTX Corporation, is involved in missiles and missile defense systems. They could be a likely benefactor of all that increased defense spending. But what about the tariff impact that they're citing? I know also in Europe they're increasing the defense spending as well. I would imagine RTX would be a beneficiary of that. But the fact that they're concerned about tariffs, why? I mean, aren't you concerned if they're concerned?

I think the tariffs aren't going to have as large of an impact on these defense contractors because everyone is increasing their levels of defense spending. Who's likely to benefit? The largest companies that can withstand the impact of those tariffs. Kevin Mann, you picked for us today. It is RTX. Thank you. Always great to see you.

All right, here's what to watch today. We get the latest looks at home prices, consumer confidence, as well as the JOLTS report this morning. And again, a busy day of earnings with Starbucks, Coca-Cola, GM, UPS coming up shortly. Visa and booking holdings among those reportings. And don't miss Commerce Secretary Howard Lutnick and this conversation with CNBC that's coming up at 2 p.m. Eastern time today. Before we let you go, we want to take one more look at the U.S. stock futures. As we mentioned earlier today, in the green across the board, the Dow looks like it would open up about

100 points higher. That's going to do it for us here on Worldwide Exchange. You've been listening to CNBC's Worldwide Exchange. You can always catch us live weekdays at 5 a.m. Eastern. At Comcast, our commitment to the military community goes back to our founder, U.S. Navy veteran Ralph Roberts.

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