Shares of Tesla (TSLA) are sinking following reports that the Justice Department is investigating whether the company committed securities and wire fraud in its self-driving vehicle claims, Reuters reports. Rivian (RIVN) faces mounting competition in the electric vehicle space, with one analyst suggesting that cost-cutting is the automaker's "core focus." The Biden administration is reportedly considering new restrictions over export licenses for companies supplying chips to China.

Yahoo Finance also continues its coverage of the Annual Milken Global Institute Conference, interviewing Lazard (LAZ) president Ray McGuire.

For more expert insight and the latest market action, click here.

Video Transcript

Here in New York City.I'm a Smith alongside a Madison Mills.Welcome to our new show catalyst from equities to commodities.We are decoding trends and uncovering the drivers behind today's market moves.A team of experts are here to help you navigate all the possible outcomes to help you make the best decisions for your portfolio.It's Wednesday May 8.Let's dive into the analyst moving the markets today earning season entering its final stretch here testing the market strength in the last few trading sessions with 80% of the companies in the S and P 500 reporting already from pays for 5% earnings growth rate in this first quarter.That is the biggest gain in almost two years according to fact that we also keeping an eye on crude this morning oil futures, extending losses down roughly about 1% on concerns of rising inventories.That's putting pressure on prices.This comes after the US Energy Information Administration.The EI A cut is 2024 world oil demand growth expectations and also hiked its output forecast for the full year.The I A is set to inventory data later this hour and S is feeling some pressure this morning after the Commerce Department confirmed that the US is revoking certain licenses for ch exports to type Chinese tech giant h away.The agency saying the decision came during regular asess into how the agency can protect us national security and foreign policy interests focusing in on the chip sector.Here this morning, the US Commerce Department is considering restricting the export of proprietary or closed source A I models.This is according to a Reuters report.Now this is just the latest provision meant to safeguard A I intelligence systems from China.Now, just in March, the administration halted shipments of nvidia's more advanced A I chips to the country.And why we're bringing this up is exactly what this means for so many of the chip makers here in the US when we talk about this report and the impact that this is ultimately going to have on us names, Qualcomm and Intel are two names that we're talking about here this morning and you had Intel coming out saying that the band is going to impact its second quarter revenue.So again, what that pressure could ultimately look like here in the coming quarters is something that investors are taking note of and what people really need to start to assess and realize here when they're starting to make some of the strategic movements here for their portfolios.And it's a great point, Sean on Intel kind of reversing some of their guidance for the second quarter here, as you mentioned.And Steve saw a friend of the show telling me this morning that that is part of what's leading to some of the downward action that we're seeing this right across your screen in the broader industries.Now, what's interesting here though, is that Intel and call the business they were doing with China was already really limited.So I wonder to what extent part of this is Intel already having a really tough time and saying, hey, what a great excuse to tell investors about with why we might be having some of this bad news here.I am curious to how us policymakers are going to be interacting with China specifically as we get closer to the election, Sean.Are we going to see more like hawkishness in their activity particularly too as we have this A I expansion?Are we just going to hear more and more of these restrictions?You would think?So when you take a look at the Biden administration and a potential Trump presidency, both sides, you can make the argument that they have taken a tough stance on China.You could argue that maybe if Trump were to be elected and back in the White House come November, he would be even tougher on China.That's generally the sense that we have been getting from strategists from economists to industry experts here over the last several months.And then you also have to talk about what exactly this means for China and the potential backlash there.And ultimately what some of those retaliatory measures could potentially look like down the road and what companies are then positioned to almost be hit the hardest here when we talk about those future retaliatory measures as well.So when you talk about companies that have a large exposure to China, they're watching these developments and escalation here in the tension between the two countries.That's something that's on investors radars here across industries.That's a great point.And came up when Chinese officials were saying that the Tik Tok Ban situation opened up a tit for tat.So definitely something we're going to continue to monitor here.Well, markets are on edge ahead of a busy week for bond sales, $42 billion of 10 year notes on sale today and this is part of the record breaking 100 $25 billion worth of treasuries that are up for auction this week.So what does the demand of these auctions?Tell us about investor sentiment for more on the fixed income space?We are joined by Mo in court court strategies cio thank you so much for joining us, Mo He, I'm curious about your thoughts on the demand that we're seeing at these auctions coming in a little bit better than we had perhaps anticipated.What is that telling you about the action that we're going to see moving forward in the space.Thanks for having me.I think as you mentioned, the demand has certainly been pretty good with respect to treasury auctions.I think when we take a step back, we have seen correction in valuations.When we started the year tenure was at 3.9% where we were a couple of weeks ago, tenure had reached around 4.7%.But certainly a good amount of repricing.Essentially.What that repricing has done is it has recreated value in fixed income.I think that value essentially implies that on a go forward basis over the next one year, three years, investors can expect healthy return in fixed income under most scenarios.And then in a scenario where growth starts to slow down, investors can have even a double digit return in fixed income, which is why you are seeing a good amount of demand both in the treasury auctions, but broadly speaking across fixed income flows.So when you're talking about that investment opportunity there, more specifically, where do you see the most opportunity for investors given that demand that we will likely see?Yeah.So I think from our perspective, we see plenty of opportunities in high quality fixed income within the US space.I think agency mortgages is one area where we see a lot of value that sector underperformed over the last couple of years, particularly Post Silicon Valley Bank.As some of the bank portfolio liquidations led to cheapening in that space.When we go outside of us, we are seeing value in some of the high quality sovereign and high quality credit expressions outside of us where growth has been somewhat weaker, where inflation is getting closer to central bank's target, for example, in countries like UK in Australia, in Canada.And then when we go beyond government and high quality mortgage market, even areas like high quality investment grade and then even FX or emerging market foreign currency space is offering value for investors to utilize to construct a high quality fixed income portfolio.Well, I'm curious about your take on that particularly because in reaction to what we heard from the cash car yesterday saying that we could have to stay higher for longer if we can't tame inflation.Is that a catalyst for yields at the back end of the curve to also stay higher for longer?And then would that make the long end of the curve more attractive to us investors?I think yields can certainly stay higher for longer.I think the argument for higher for longer is inflation persisting above central bank's target for some extended period of time.Another argument for higher for longer is the ongoing fiscal deficits where as far as I can see, we can expect somewhere around 6 to 6.5% deficits, irrespective of the election outcome in the US.So in that federal worker yields can certainly stay higher for somewhat longer.But the market is already pricing that when we look at 10 year, around 4.74 0.6% a 30 year around 4.6 to 4.7%.That is already pricing in some form of hire for longer.I think one of my colleagues has done Tiffany Wilding has done a pretty interesting work with respect to central bank policy.And the assessment is that at this point, central bank policy is shifting towards what we would call an opportunistic disinflation.Under that paradigm, the central bank can remain focused on getting inflation towards target.But at the same time, also be mindful of the downside risks that are posed to unemployment rate or employment when the monetary policy is already restrictive as it is currently.So under that framework, even if the inflation doesn't get to 2% inflation gets to two point something somewhere closer to 3% you could see fed cut rates 1 to 2 times this year.And in a scenario where inflation persists somewhat longer than the fed can keep rates here for some extended period of time.But if growth was to come down, then there's plenty of room for fed to cut rates much more than currently expected.And that could lead to a pretty meaningful upside return in fixed income.To what extent does the risk of the deficit play?And your view?Long term, we're hearing a lot more about that elephant in the room lately.Yeah.So I think deficit is a concern.I think, you know, 6.5% area deficit for an economy that already has nearly 100% debt to GDP and where the nominal growth potential is, you know, call it somewhere around 5%.So essentially that means that the deficit is higher than the nominal growth, which means that over time debt to GDP in the US economy continues to grow higher.So it's certainly a concern.I think the way it plays out is probably through the term premium in the US rates market, which is why our preference is towards more intermediate bonds towards more five year seven year point of the curve relative to a more longer dated point in the curve.Natal.We really appreciate you taking the time to join us here this morning, Pimco Core Strategies Chief Investment Officer.Thanks so much.Thank you for having me coming up.Tesla's legal troubles continue the Justice Department reportedly examining whether Tesla misled consumers over its autonomous vehicles will tell you what the long term effect could have on the stock.On the other side of the break.Let's do a check of the market sponsored by tasty trade.Looking at a lot of red here, the dow basically flat the S and P down 2/10 of a percent in NASDAQ down 4/10 of a percent here.The dow just barely slipping into the green, but it's interesting to see this movement, particularly after we've seen a couple of days of the market rallying, but it was on pretty light volume here.So we might be seeing a little bit of profit taking this morning, especially after some negative company news when we have earnings from a company like Uber pushing that stock down.We also have idiosyncratic news with Intel and Tesla putting a little bit of a damper on the trade this morning and that's why we started to see futures kind of ticking down after those reports and still seeing that negative action in the trade today, Tesla shares thinking after us, prosecutors are reportedly investigating whether Tesla committed securities or wire fraud by misleading investors regarding the capabilities of their self driving technology.Now this is according to a report here from Reuters, Yahoo Finance is pro Romanian has the latest details on that and you can see the concern playing out here for Tesla shares off just about 2.5%.Yeah.Reports of this probe into whether they committed, you know, wire fraud with communications to consumers about their abilities with the self driving software and also securities fraud, you know, did was were any investors induced into buying the stock because of what Musk was saying, you know, there's videos of Musk saying or videos of Tesla saying that the driver is only sitting here just for demonstration purposes.The car is self driving.So you have a lot of puffery here that's the kind of the big question is, is it salesmanship?Is it, you know, we have the best number one self driving software.Like, did you hear that all the time?Is that just sort of like a sales tour?Is the actual, they knew the system was unsafe or were not, was not reliable.They still said it anyway that it was in, in order to profit.So it's a lot of, they got approval out there for fraud, but it's still not a good look right now and the probe is ongoing, you know, what's going to happen with that, but it's not a good look for their software.Well, that's my question is what is really new about this report because we already know that the justice department has had questions about the self driving technology and Tesla has talked about that in some of their filings.So I'm curious what stands out for you as the newest bad news for them here, right?So last year, Reuters reported that the probe was about sort of the soft for itself, right?Is it defective?And, and then did they knowingly put it out there like criminally right now?It's like this is fraud.Is it, is it outright fraud?Not only for consumers but also investors and you know, there's gonna be investor lawsuit coming up after this and if not already.So that's the new wrinkle here again, it could go away, they could resolve this, it could go away, they could pay a fine.Um But at the time right now, it's beyond just because NHTSA also is pursuing, they want all this data from the crashes to kind of show that did Tesla's remedial efforts when they did a recall were those affect?And they question whether it is all pro great as always.Thank you so much for joining us.We really appreciate it.Thank you so much for now.We are going to go over to our guest.I believe we because Tesla's dog is under pressure following the movement that we are seeing this morning, Dan Levy is joining us here, Dan, thank you so much for being with us.I hope that you're able to hear pros great commentary on this.And he was talking about the question about whether or not this really is fraud.So I'm curious from your perspective, Dan, to what extent are you concerned that this could be fraud from Tesla?Yeah, good morning.Thank you for, for having me.I I think that broadly for, for Tesla and, and you know, I won't comment to, to the report itself.I think Tesla right now is in the process of validating and demonstrating the capabilities of, of FSD.Uh Obviously, you know, there one side of this that we're well aware of is consumer and consumer uptake and getting consumers to appreciate it.But on the other side of it is the regulatory front and um, you know, in general, we view the regulatory side as a risk that needs to be monitored.Uh It's one where so far Tesla has been able to keep the functionality that they have out there, but the, the functionality, but the regulatory side is a risk that certainly does need to be monitored on the FSD.Then just give me your sense right now of Tesla, how it is positioned following the run up that we have seen since earnings and the current valuation of the stock right now, given some of those macro concerns that you were just talking about.How big of a risk do you see that potentially being here?Then to the downside, there's a lot of uncertainty for Tesla right now.Um from a fundamental standpoint, things are obviously a bit more challenged.I think people are well aware that ev demand is pressured.Their, their, their demand is is under pressure.We obviously saw that with a very soft one Q volume estimate.At this point, people are forecasting volume to be largely flat, we flat on the year which you know, was one sort of an unthinkable thought for for Tesla to have flat volume on what should have been, you know, very robust growth.So the fundamental side is is challenged on the other side of it, you have uh an investment thesis that's in pivot.And I think that there is uncertainty because the stock or the narrative is pivoting away from what was viewed as some certainty around vehicle sales, leveraging a cost advantage and instead leveraging bets that people view as possibly binary, right?The push to autonomous, the push to Robo taxi, these could be potentially largely disruptive bets but they're binary.You know, people just don't know what the outcome is.And so that's why I would say there's an air of uncertainty, right?And people are maybe buying the story about full self driving versus the reality of it being here.But I wanna get your take on the Robo taxi here as well.Does today's news change, what we might be anticipating from the Robo taxi moving forward?Well, I think we're, you know, I don't know that this, this really changes the narrative.I think we're, we're waiting for a couple of key things on Robo Taxi.One is certainly as it relates to today, you know, any updates on the regulatory front, but we're waiting to see, you know, any updates on, on tape rates.Uh And then we have an A G coming up uh which is a key event to watch for.And then certainly August 8th is the Robo Taxi launch.Um You know, and, and clearly this narrative needs to play out both from the FSD side, which is more of a, you know, we view to the driver assist functionality as well as the fully driverless technology that Tesla has, you know, alluded to.But really hasn't given us much meat on the bone.All right, Jim, we wanna switch gears here and talk about another EV player that's certainly moving here, at least in the downside today.And that's riv and the EV maker extending its losses.Shares are down just about nearly 7%.Right.Now.In early action, when you talk about the disappointing quarterly loss that the company reported, they're doing this amid this effort here to revamp their manufacturing operations are also trying to boost ultimately the output here for evs, how do you see Vivian positioned within this increasingly crowded ev space?But we think that Rivian has a really impressive product, really good technology.So we like what's going on there.But we think at the core for Rivian is a key challenge on narrowing a cost right?Uh First quarter was it was it was a fine quarter relative to consensus expectations, but it was still sharply negative ebita all the more so on free cash flow.And I think what people are waiting to see is, you know, they've communicated a path to reaching gross profit break even by the fourth quarter.Uh the factory rerate that they just underwent or that they're, they're in the process of going right now is going to be a key opportunity to drive cost reduction.But in many ways, we think this is a show me story and then on top of that, you have tough demand where there's potentially price pressures, which could further pressure the path to profitability, so great product, really good technology.But the question is on the path to narrowing those costs and reaching break even and ultimately profitability.Well, Dan, according to the digi times here, Apple is in talks with Rivian about a possible partnership.What do you think the likelihood of that is and what does it mean for Apple moving forward, particularly after they've moved past the idea of an Apple card instead invested into A I, it really hard to say, uh you know, and it's, it's, it's unclear, you know, if there's any, any substance to that.Uh I look, I, I think in general, Rivian is constantly reviewing or considering the opportunity for strategic partnerships, any of that that could help, you know, certainly on, on the investor side, you know, I think people are always watching for the opportunity for a strategic to come in and, and help Rivian in, in, you know, in, in that regard.Um But right now, I think the core focus for Rivian really is on uh reducing costs and driving toward profitability.That's really the the core focus right now, Dan does Rivian need a partnership like Apple, not necessarily, not necessarily.I think right now, like I said, you know, the core focus for them just needs to be on narrowing costs.And, you know, as you can see with Apple, they've, they basically exited the car market, right All right.Well, Dan Levy, always great to have you.Thanks so much for taking the time to join us here this morning.Barclays, a senior auto analyst.Thanks.Thank you, Anheuser Bush shares are rising after reporting better than expected results in the first quarter, slumping sales in the US.They were actually offset by gains that the company saw over in Europe.We're looking at a move higher of just about 4%.Brooke Dipalma has those details for us, Brooke.Yeah, good morning to you.Both cheers jumped as much as 5% at the market open this morning.Largely because Wall Street was really impressed by uh earnings and revenue beat both the top bottom line.That earnings beat came in at 75 cents and that was largely driven by stronger than expected margins.Revenue grew 2.6% year over year to $14.55 billion on higher pricing.But that was once again offset by volume declines.And if we take a closer look, overall volume came in higher than expected, but still down about 0.6% and largely driven.As you can see here by that North America segment of the business where volume declined 9.9% largely due to declines here in the US.Because of that one year anniversary of the bud Light boycott, we did see sales to retailers as well as sales to wholesalers down about 10 to 13% for both segments as those grocery stores and retailers restock their shelves this spring.But the company did see that, see that did say that they are improving gradually from May 2023.And now market share here in the US is roughly flat compared to last year.But this would decline was largely offset by middle America, especially Mexico.They did call Mexico their second market.We did see increased volumes there largely driven by Corona.We also saw Mia, particularly Europe have strong volume growth revenue.There also increased in Europe and that was largely driven by pricing and premium brands that are doing well.But largely there is a renewed focus here for Anheuser Busch to really focus in on what they believe consumers need and what sort of connection they want from this beer giant in terms of promotion at live music events as well as sporting events.And of course, we've heard from so many other companies that they're picking up share from these year uh year, over year losses from Bud Light.And so the competition is brewing, I guess you could say, but the competition definitely is still very apparent across the board as these beer makers really look to capitalize on that loss that we saw last year.Well, I loved that.Thanks for joining us as always, Brooke, really appreciate you.Thank you so much.Well, Shopify shares are plunging this morning after announcing it anticipates decreasing gross margins during the current quarter.This comes as it deals with the impact from the sale of its logistics business to flexport with the company saying its revenue is also going to take a hit.Now, what's interesting here is that we did see a 23% jump in their Q one revenue and merchants were selling more through the E commerce platform.But again, they do expect that to slow down.That does feel like an interesting economic indicator to me, particularly given that we saw a lot of selling decreasing at the likes of Etsy and ebay and their earnings.So it's interesting to see that bifurcation but looks like that gross merchandise volume raise was just not enough following that logistics uh sale that took a big a big headwind for them about 300 basis points there.Yeah, we're seeing that effect clearly the most recent results.Also the uh prospect that this could potentially weigh in current quarter results as well.You're looking at a loss here of nearly 20%.Putting that in perspective, we could actually see the biggest intra day drop here for shop by on record if we do remain just around those current levels.So an important number here to keep in mind and as we stand right now with around 61 bucks a share, it would be, we could see maybe the lowest close that we had seen since November.So we are seeing some material selling here on this name on the heels of those results that surprised the loss that you were just talking about after the sale of its logistics business.And then even beyond that, given the uncertain macro environment right now, given the fact that the consumer may be pushing off some of their spending, you are reassessing their spending plans that ultimately is going to weigh on Shopify's business here going forward.So you have the fundamental side of the business.Also, some of those macro concerns there impacting Shopify, I guess current quarter, most recent quarter, the current quarter right now and then also potentially the second half of the year.So I think all that on the minds here of investors for Shopify.That's a really good point, Shana.And it definitely tells us a lot about the sector in terms of consumer spending as well.Well, the ev sector in focus on Wall Street today, but the clean energy transition in the US going well beyond cars.It also involves upgrading the electrical grid to support increased power demand for A I and data centers.So which companies will likely benefit from that transition?Yahoo Finance.And as has the list for us and as a man and we saw how higher interest rates last year put pressure on the clean energy sector.But surging electricity demand is expected to benefit companies working on renewable.So this year is different, improving infrastructure incentives from the government's inflation reduction Act, the Ira that is aimed at accelerating the transition to green domestically produced technologies are also expected to lift the sector.So which of the companies are we looking at?Well, on a clean energy chart here, you can see Ver Nova, this is the company that just recently spun off out of GE and the stock is up seven percent since going public.This is a renewable energy company.They make gas turbines, they make wind turbines and analysts are bullish on this stock because of increasing electricity demand and also grid investments.You've got seven buys, four hold and one cell on this stock.We are also taking a look.By the way, this is a year to date chart.We are also taking a look at first solar.This is the biggest, the largest supplier of domestically solar modules.The backlog goes into 2027 year to date.The stock is up 11%.Goldman Sachs recently in a note talking about how for solar also has direct partnerships with data centers like Microsoft, for example, so bullish on that stock.And then we're also taking a look at the utility space which by the way, utilities is the third best performing sector out of the S and P 500 this year.And we are taking a look at next era energy up a year to date up 19%.This company delivers energy that's in, in the form of renewables and natural gas.Also nuclear and their CEO in their latest earnings call, talked about the redation of industries in the US being a tail one for this company data center energy usage also being a tailwind for this company.17 buys five hold and one sell.So while we do see in the overall renewable space, we are still seeing weakness in that area.We are seeing companies that are these bright spots uh within that space, especially with the expectation of interest rates being cut later this year, guys, some that are well positioned here potentially for the coming years.All right, and that great stuff.Thanks.Thank you.We got much more of your market action ahead.You're looking at the dow up just around 21 points of trading just above the flat line on the flip side.S and P and NASDAQ under pressure here in early market trading.We'll be right back.You're watching Catalyst so much attention here at the Milken Institute conference on inflation and the outlook for interest rates and maybe we haven't talked enough about the global outlook and some of the biggest risks ahead.Let's bring in President at Lazar Ray Maguire, Ray.Good to see you again.It's been a while.Good to see you.Great to be here in person.One of the, one of the biggest risks I don't know if we talked enough about is China globalization risks.What are some of these conversations like with clients right now?So I would separate the, the limbs in two parts one.And I'm gonna come back to clients because the view for the clients are somewhat different, not diverging but different focus.What's in front of us and what's ahead of us today?Clients are thinking about impact of inflation, the market valuation, both the asset management clients as well as the corporate clients.That's what's in front.What is the fed policy?What is it going to do with borrowing rates?How does that reflect in the valuation?If I want to monetize, if I want to go fund the transaction, where the asset manage for the Corporates, what's my currency?If I want to make a strategic transaction, reliance on equity as a source stock as a source, the benefit of which is that I get to share in the upside and I get to share in the synergies.So let's part that's what's in front of us.What's ahead of us is as you've described what's taking place geo economically and geopolitically, the global North and the global South.The dependence at the global north, especially America has on the global South is not insignificant.For example, as we think about one of the macro trends, energy transition.If you look at the dependence that the US has on the global South China refines 70 to 90% of the precious minerals that are necessary for energy transition.If I look at the continent of Africa, the source of many of those raw materials or Peru or Chile, if I look at the global South and see the dependence unless we somehow figure out how to invest, so it become more self reliant.We have exposure, which is not insignificant.Today, we're energy secure tomorrow, we need to make certain that we're as energy secure tomorrow as we are today.So from the perspective of your corporate clients, when you think about the over reliance on other countries, does that drive investments as a way to safeguard the future?How do you think they think about that?The answer is not only from a corporate standpoint, from a sovereign standpoint, the chips Act as an example, the recognition that we need to be able to manufacture our own chips to perfect the manufacturing of chips.So yes, for the sovereigns and for the Corporates.Absolutely.And what does that translate into?We now have three or four of the large tech companies going to put $200 billion investment into capital expenditures.So yes, Corporates are thinking Capex, how do I invest today?Data centers as an example, energy sources.Remember in order to in order to get to A I today, it takes up 4% of the country's energy.The prediction by 2030 it takes up 25% of the country's energy.So we have to build energy sources in order to be able to power anything to happen to generative A I So, yes, our corporations are actively thinking about how they go through and make Catholic expenditures for the future.Are corporations prepared correctly for either election outcome or the presidential outcome in November?I get the sense that ceos are, they know it's there but they're not really planning their business for either outcome yet.Well, I think that it may not be visible but corporations at moments in time like this go through scenario planning.We do, we try to help them out.We have a geopolitical advisory group which is, you know, which is populated by some of the best thinkers on the planet.And we put a lot of thinking in scenarios of what happened with this election outcome.What happens if there's a different, a different election outcome?So the answer is yes, they're thinking actively about it.Our group is very active globally and so the answer is yes, what's the worst outcome?What's the worst outcome there?There are a few scenarios out there to which we need to attend in order to be prepared?Well, I guess my question would be if we're talking about the US election, are the scenarios between a second Biden term or Trump term really that different from a corporate standpoint, they could be.But across the planet you got 50 some odd elections.So look at what, so the risk that we have as we think about investing in the supply chain offshore, the two risk fundamental risks that investors look to one is currency and the other is political risk.So let me ask you about that piece of it.You mentioned a I you mentioned chip supply chain, these are massive projects.We were talking about the chip that $39 billion in subsidy.Do you look at what's happening in Europe?More than $40 billion at a time rates are still incredibly high or not incredibly high, relatively high?I should say, how do companies make that calculation about investing in the future?But knowing that debt, they have to incur as a result is still going to be pretty high.So the question is because these are so fundamental to how companies and the country operates thing with scenario if we don't make the investments.So the answer is from return standpoint, we need to make sure that we're risk adjusted to have appropriate returns.But we also have to think strategically, remember strategy drives financially in the corporate world and even in the asset management world strategy drives how they think about allocating today.Today, we have $10 trillion of capital on the sidelines deciding how it allocates itself in order to generate a return for the for the for the shareholders.We have to do the same thing in terms of how we allocate our resources.So companies are thinking very strategically about how they go about doing this.And so yes, the risk profile is critical.They need to make returns for their investors, for their shareholders.And we advise them that is a primary concern, but we also advise them on how they remain competitive.They're not incongruous, they're one and the same in order to maintain the focus on making sure that they do what is necessary as a corporate citizen.So we're seeing, we're seeing all of it come into play at a moment in time when you have such geo and geo economic and geopolitical challenges.We've spent decades doing big deals.One of the most celebrated folks on the street doing deals.What's company's sense on the regulatory environment?Are they tepid on trying to do a big deal with a backdrop like this?So uh you're great to ask the question, that's a headwind.And so corporations are trying to figure out as they go through and assess how they're going to grow and grow strategically, will there be impediments to a strategic combination?And that has become a factor here in ways that it has been historically, maybe not as profile as it is today going through that like purchase price and maybe there's more breakup fees and you see it get played out in different transactions.But the risk apart from the economic consequences, the strategic consequences, remember the vast majority of these transactions are strategically driven very rarely in this environment are things just solely economic.And again, strategy is driving financing.So the answer is yes, as you think about a strategic transaction, you have to ask yourself the question and get as much advice as you can on what the, what the likely likely regulatory sponsor is going to be.That is now part of the calculus to pick up on Brian's point though, when you talk regulation, it's not just about concerns about anti trust getting flagged.There's also concerns about any kind of foreign investment getting flagged, particularly in the tech space too.And I wonder if somebody who has been in this space for a while, where do you see this all going?Where's it all going to, you know, it will play out for so long as we make the investments to remain competitive and get beyond the divisiveness which we have to do in order for this country's best days to continue to be ahead of us.We got to make those strategic investments.We have to reduce our exposure to the supply chain.We have to reduce that risk profile, foreign supply chain, foreign supply chain.Today we're energy secure, admittedly based on traditional energy sources.Tomorrow, we need to be energy secure and technologically secure.Remember today, we're the most advanced technology that exists anywhere on the planet.We have to maintain that lead, which means we got to continue to invest.All right, we're uh we're gonna leave it there.The President Lazar Ray Maguire.Good to see you again.We appreciate it.Great to see you all US, chip production is expected to skyrocket over the next decade, bolstered by incentives from the Biden administration's Chips Act here.With more on.This is Yahoo Finance's Dan Halley Dan.That's right now.This is according to a report by the Semiconductor Industry Association and Boston Consulting Group.And essentially what they're saying is that the chips Act should be a success as far as getting the US uh back up when it comes to building chips on shore.And so let me just go over some of the numbers here.Uh They say that there's uh a 203% projected increase in fabrication capacity uh from 2022 to 2023.That's compared to an only 11% increase in the prior decade from 2012 to 2022.Now, fabrication is essentially a place where they build chips, so they call them fabs because it's a fabrication facility, but it's just a factory where they build chips.The the other thing to point out is, and this is very important.The US is going to grow its share of the ability to build advanced logic chips.These are chips that are below 10 nanometers uh when it comes to the, the size of the uh the transistor.So uh think of what you have in your iphone, uh your ipad Apple just announced yesterday.Uh a new three nanometer chip.Uh they, they M four, we don't build those in, in the US, they're mostly built overseas.But this is going to boost that uh to 28% of global capacity by 2032.And again, in 2022 we built percent of that.So that means that the US is going to be increasing its ability to get these kinds of high end ships out the door from within the country.And that should help with supply chain bottlenecks in the future.And this all comes obviously uh as a result of the tensions with China and then also the pandemic where the supply chains were just completely disrupted and there are chip shortages across the world.So the idea here then is to get more uh chip capacity on the ground in the US so that uh we can kind of avoid those in the future.All right, Dan, thank you so much as always for joining us.That was our very own, Dan Howley, our in house tech expert, appreciate it ride share earnings in focus with both Uber and Lyft reporting.Uber is falling after reporting a surprise loss in the quarter including a $721 million loss related to the company's revaluation of equity investments.Meanwhile left seeing gross bookings jump 21% from the prior year.It's active riders growing at the fastest pace since 2022 here.With more.We have John Blackledge TD cow and senior analyst, John, thanks so much for being here.I mean, talk to me about the bifurcation that we're seeing here.Is this an indication to you that consumers are getting kind of tired of Uber's pricing and they're switching over to Lyft or is it a different story?Yeah, I don't think so.I mean, yeah, let's let's unpack it here.We'll start with the Uber.Um you know, on the, on the one key result.So the gross bookings uh were up about 20% year over year.That was slightly below our forecast as mobility gross bookings and trips were impacted by um lower than expected la time results.But IDA beat solidly 5% above consensus.And then the two Q guide was fairly solid gross bookings on a constant currency basis.Up almost 21%.EBITDA guide was kind of in line with consensus at the midpoint.I think the shares rate are down right now for, for two reasons.Number one lower one Q mobility gross bookings and then the two Q guide was solid on the constant currency basis, but lower on a on a reported basis as Uber is facing higher FX headwinds than we thought particularly um on the mobility side overall.Um I think the trends remain strong for Uber, right, 15% user growth, they had 6% trip frequency growth that drove overall trip growth uh uh up 21% year over year.And then on the mobility side, uh the user growth was 17%.So it was above total company user growth and they expect that to continue into two Q and the rest of the year.Um But, but again, yeah, so I think just the lower mobility uh in one Q uh and the guide was, was a touch light on Lyft.Uh you know, they had a really good quarter, right?They, they, like you mentioned, they beat on gross bookings revenue was better.Uh IB da also better two Q guide on gross bookings and IBI Da were above us.So we raised numbers raised our price target.Um And they also have an event coming up.They had their first uh analyst day in New York City on, on June 6th.So that, that was also something um that, that I think people will, you know, probably be somewhat positive kind of going into that.Um you know, as they're going to lay out, uh I think we think they're gonna lay out like intermediate term targets.John, I want to talk to you first just about Uber and more specifically the stock reaction that we're seeing, we've got shares down nearly 8% given what you had just laid out there a moment ago is then the selling that we're seeing today a bit overdone.I, I think, I think it will ultimately be overdone.Um And but, but I I kind of understand it, you know, it's been a great stock over the last year.Um so expectations are, you know, fairly high.And so with a little bit of a, of a Miss uh at one Q and, and as I, as I mentioned, the two Q guide on a reported basis, a little bit softer, you know, you get this kind of reaction.But like I said, I mean, the the core just underpinning fundamentals of the business remain strong.And so I, I do believe it's a bit uh a bit of an overreaction.Well, John, I know that both Lyft and Uber were asked about the potential risk to ride sharing companies that autonomous vehicles pose particularly given some competition from Tesla.Of course, both CEO S sounded pretty optimistic though.So let's listen in, I get excited about autonomous cars because I think great, it's gonna be another way for people to get around.You know, you can sort of think of it as another car that we could, you know, run into our network.If you're an A V fleet owner or you are an individual owner of a car, whether that's a Tesla or another kind of car, you're just gonna make more money and make a higher kind of return on your investment if you plug in your A VS into uh the Uber ecosystem and into Uber demand.So um you know, we think we bring a lot to the table, we're looking to partner with the A V industry.So John, is it that easy that this can just be a partnership.Yeah, yeah, they, they both kind of mentioned the partner approach and like if you think about it for Uber, right?They have the huge customer base, they have the matching of routing technology for both companies.The customer base is matching a routing, the payment systems, regulatory expertise.Um and that that can drive higher utilization for A B partners over time.Um And I think Dara mentioned, like also um he thought A V could expand uh mobility marketplace uh with, with lower pricing which would spur higher adoption.Um And Uber in particular has the partnership with Waymo uh in Phoenix, they are expanding A B partnerships on the East Side as well.I think just the reality in my view uh as it relates to A B is that the headline probably headline risk probably won't uh match the timing gonna take uh to fully scale the technology.And as it scales, Uber will be the most scaled partner globally on mobility for A for potential A B partners and then a leading one, potential partner in delivery and Lyft will certainly be able to partner uh in the US and Canada, those are the two markets that Lyft uh operates in John.Can you give us a better idea of what exactly that timeline looks like?Well, uh yeah, I mean, your, your guess is probably as good as mine.I mean, the the companies uh haven't really said, I mean, I think if you listen to Dara today, um he said it's, it's gonna take time and, and even LA and lift and evenly last night, it's gonna, um take many, many years to be fully scaled.I mean, just for example, I think way os operation in three markets with Austin coming, um, that's three markets in the US.Uh And so it's gonna take many, many years And I think, I think that's kind of how they were talking about it and that, that's why I said, like we're gonna see these headlines.Um but actually when it's fully like when it is fully scaled, it's gonna be probably many, many years.All right.TV Cowens and John Blackledge, thanks so much for joining us here this morning.Ok. Well, it's early in the trading day, but a key theme is the individual names to watch.Not so much the broader market and its growth, stocks getting hit today.Earnings from Uber affirm, Shopify and upstart all declining here on the heels of their quarterly results.And Mattie, we're this up on the heels of some commentary that we got earlier earlier this morning from Morgan Stanley's Andrew Sheets and he was making the case that this isn't really this macro market or macro driven uh market that everyone has been talking about.It's more micro and he pointed to earnings.So today, at least when you take a look at some of the pressure that we're seeing in these growth names are really highlight some of that rotation that we've been seeing within the market and where we are seeing maybe pockets of strength outside of the mag seven.And then ultimately, the question is whether or not earnings are going to hold up to then further support the markets gains.It's a great point and it's similar to what we've been seeing, particularly if you take a look at some of the ETF S out there showing some signs that we are seeing a little bit of broadening again beyond some of the growth here, names that investors tend to look towards.I was looking at the vanguard value.ETF it's one of the top 10 ETF S getting inflows this week, which could be an indication that investors are starting to see some broadening and looking back on our notes too.We know that Black Rock in Q Two said that their outlook indicates that risk appetite could broaden beyond tech.And if you look at those ETF inflows, you are seeing evidence of that.Yeah, man, that's a great point because even if you take a look at the sector action today and where we are seeing that leadership that also points to that point that we are trying to make here are making here just in terms of that rotation, right?Because when you take a look at the more defensive names that are leading today's trading action.You've got utilities among the biggest gainers today.So again, that's a very different picture than what we had been seeing, especially when you take into account the gains that were mostly driven by the mag seven last year.So again, a bit of a road, the question is whether or not that rotation is going to stick.Let's do a final check of the markets here.We're still looking at a bit of a mixed picture.You've got the dow and the S and P holding on to gains just barely for the S and P the nastic those still in negative territory.And coming up our new show wealth dedicated to all your personal finance needs.Our very own.Brad Smith is going to have you here for the next hour.We'll talk about tipping etiquette.So stay tuned for that and more.