Closing Bell - Closing Bell 04/30/25

Episode Date: April 30, 2025

From the open to the close, “Closing Bell” and “Closing Bell: Overtime” have you covered. From what’sdriving market moves to how investors are reacting, Scott Wapner, Jon Fortt, MorganBrennan and Michael Santoli guide listeners through each trading session and bring to you some of thebiggest names in business.

All right, guys. Thanks so much. Welcome to Closing Bell. I'm Scott Wavre live from Post9 here at the New York Stock months ahead. In the meantime, your scorecard was 60 to go. Looks like this, the first negative GDP print in years, sending the major averages into the red today. We are off the lows though. PCE was hotter, ADP was weaker, stagflation fears seem to be increasing today.

We are watching the NASDAQ very closely as well, given what's to come in overtime tonight. Meta and Microsoft both reporting. We will walk you up to those highly anticipated earnings reports. You can bet on that with our experts. It does take, there's the stocks today. It does take us to our talk of the tape. Where exactly is this economy and stock market going? Let's welcome our panel. Steve Leesman, CNBC Senior Economics Correspondent.

Stephanie Link with Hightower and a CNBC contributor, Dan Greenhouse of Solace Alternative Asset Management. It's good to have everybody with us. Steph, you looked into the data today and didn't come out as gloomy as some others. No, the headline number was disappointing, negative 0.3, but if you do look underneath the surface, business equipment investment rose 22%. Consumption rose 1.8%, and yes,

it's down from 4% last quarter. I get it. However, it is actually better than what people were thinking, like 1, 1.2%. And then of course, you look at final sales to private domestic purchases. That was up 3%. That strips away a lot of the noise, trade and inventory and government spending. So you get true demand. and that demand was 3%. So it is a better than expected number. And that's why we actually rallied from the lows, not out of the woods. I understand GDP is actually backward looking, but the other data points today

that I was excited about personal income and personal spending. We get the soft data all the time on confidence and sentiment and it's been awful. But we got the best spending number since January of 2023, We get the soft data all the time on confidence and sentiment, and it's been awful. But we got the best spending number since January of 2023, this past month, in the month of March. So I'm encouraged about that. That is something. And then also, pending home sales.

I mean, that's a leading indicator. And maybe it has to do with rates coming down and seasonally, but up 6.1% month over month. That's encouraging. Not all is perfect, Scott, but I'm trying to look at some of the bright spots in terms of where we're at. So is this gentleman sitting next to you who calls today's GDP print a fake out.

Why so, you agree with everything Stephanie said? Yeah, because she's right. The headline number is completely irrelevant. We knew coming into March that the numbers in, I'm sorry, the trade numbers in January and February were screwed up by some gold arbitrage that was going on between the US and the rest of the country. And then March saw a big pull forward in front of tariffs. So you have to look at this number X trade because trade was the biggest drag on GDP that we've seen in decades and decades and decades.

Go to my Twitter, there's a chart there. So when you look at it at X that stuff, what we call real final sales to domestic purchasers, which is an alternative way of looking at GDP, was plus 3%. Now, no, no, but X trade is like saying X the elephant in the room. Yes, except that, but listen,

I get the elephant in the room in March, but January and February, the trade data was skewed by particularly gold inflows. I get it, I don't mean to sit here and say well X all the alcohol. I consume my diet is phenomenal I understand you can't exactly do that, but it is fair at least to look at it that way I'm not saying GDP was amazing otherwise, but it wasn't negative all right, so Steve Leesman. You've heard these takes and There have been many negative takes today as well. Square both. I don't know why those guys leave it to me to be the guy that's the party pooper here, but I'll tell you this.

I've come to the conclusion that if I'm looking at a piece of data and I don't understand how it's been affected by the tariffs, I need to look harder. And that is true of many of the positive things that Steph talked about, unfortunately, I think, which is that you had a whole bunch of consumption that was driven by people front-running autos and buying, front-running tariffs on autos and buying cars ahead of time. I believe that flattered the first quarter numbers. I think she's right though to look positively

at the income and spending numbers. It's what tells me, Scott, that we could yet escape a recession here if policy is, let's put it this way, put on a more rational plane and clarified in a way that allows businesses to invest and not be frozen by the uncertainty. And I'll show you a chart that is why I think this this quarter's number was lousy on the headline but fine underneath and I'll

explain why I think it's gonna look fine next quarter or this quarter but lousy underneath and you can see here if you look at the contributions to growth, thank you guys in the back, you didn't even know where I was going and you went there. There's inventories helping out the GDP number. This is how we got to minus 0.3, okay? You can see fixed investment, as Steph said, that was good.

Spending, I think that was the contribution. Flattered, I think, by autos. And there's that big net export number next quarter that net export number Reverses the inventory number goes the other way and it's spending that I'm worried about that all of the sentiment the lousy Sentiment some of the worst sentiment numbers we've seen in a three month period And never outside of a recession have we seen the sentiment decline like this when it comes to expectations That's what I'm worried about is that you don't get the spending because you had all that pull forward on the auto and some other Side it's got the point being it's simply too soon

Yeah to look at the real data and think that the trade war in these, you know, historically high tariffs have played much of an impact yet Leaseman's point is too, in terms of demand, it's not necessarily quote unquote real. It's not fake, but it's exaggerated by the pull forward aspect. Well, so I think that's why jobs in the labor market is so important, because if that starts to turn,

then the consumer then starts to really turn. Right now, we are getting pretty okay data. ADP was not great today, but I think weekly jobless claims are something that I pay much more attention to. I know Dan does too. Because you think it's more in the moment. Yeah, it's coincident to leading indicating data points

versus non-farm payrolls is backward looking, right? So is ADP to some degree. So I'm just looking at jobs. I'm looking at a first quarter ECI, employment cost index, at 4.6%. That means that people are getting paid 4.6% on average, some more, some less. But the point being is if you have jobs and you have wages, and oh, by the way, inflation is sort of tame, it's not accelerating, and gasoline prices are down, and we got a couple of data points today on inflation that it's not again not accelerating. So if you have all these things and you add it all up, you actually have a 4% savings rate too. I think if we do see a slowdown, they're

in better, the consumer is in a better place to handle the slowdown. Let's talk about sort of adding everything up. Do you agree with those who say the economy is undoubtedly slowing? Sure, that's relative. Next question. Do you agree with those who say earnings are undoubtedly slowing? Sure. Okay, so if you put A plus B then the C would be, man look at valuations, valuations are too stretched still for an environment which you just said you agree with to the Rick Reader point yesterday on this very program, which I want you to listen to right now.

The fair value of the equity market strikes me today. It's still below today's levels. I would argue five to 10% below today's levels. You listen, once you get through the uncertainty, then I think you've got upside, but I don't know. I think multiple today is a bit high and I think the earnings growth that we're seeing today that's priced into the market is a bit elevated.

Okay, that's Rick Reeder with us right here yesterday. Respond. Listen, doubting Rick, never a great idea. That's apparel, but you can disagree. Sure, listen, a lot of the market's valuation is tech and a lot of tech is doing, is a result of the AI story. So to the extent that the AI story remains intact, data centers, and we've talked about this,

the ancillary plays, not just Broadcom and NVIDIA but Vertiv and Train Technologies and Eaton and Vistra, et cetera. The extent that that's... Were you going down Stephanie's portfolio? We've talked about it. Sounded like it. It's a good portfolio. But there is a thematic story at work here, which granted there's some smoke with the

Microsoft and Amazon and the data center's potential slowdown. But right now that story remains in place, in which case the valuation for a lot of those names, at least for now, is justified. I don't think you can look in that sense at the broad market and say the whole market's overvalued. There's pockets of the market that are overvalued. There's a screen up here so you can't see me putting that in quotes. My point is just I understand the hesitancy and the reticence here,

but I would also remind people, sometimes GDP goes up, sometimes GDP doesn't decline, goes down. Sometimes earnings growth are up and earnings growth are a little slower. It doesn't automatically mean the stock market has to go down. But where are we with this rally back? We're back around on a forward, like 20 times.

Sure. That's not rich to you in the kind of environment that many are talking we're either in or going into? I think we have to be careful because we have spent, we, the royal we, have spent the last, I don't know, 10 years saying the stock market is richly valued. Obviously not as richly valued in 2014 as it is in 2020 as it is in 2025.

But we've spent years talking about, oh, you know, the market's trading at 18 times, 20 times, 22 times, and the market keeps going up. Now, I get it. There's something different going on right now. There is looming tariffs. There is potential AI slowdown, in which case we have to be a little more careful here. My point is just to push back and remind people that we've been having this debate ad infinitum. You know, you mentioned consumer staples.

I mean, talk about expensive for what you're getting. You're at 23, 25 times for weight, 2% organic growth. And then on the third, and that's a very defensive trade. And I understand why. I get it. People are hiding in it, but they're not cheap. That's not a place where I would be putting money. At the same time, we talk about earnings, we talked about financials, they actually

positively surprised and they reiterated guidance. And they're trading at 11, 12, 13 times earnings and they're about to embark on a huge buyback program once we get regulation to go their way. So, industrials are not cheap, but I think that is all about the AI story, at least the names that I own. It is about AI being in the second and third inning and them seeing the growth and the earnings coming through. Industrial's actually did positively surprised and the guidance have not not been cut.

So I think there are pockets, Scott, of where I want to be and where I don't want to be. And Staples is definitely where I don't want to be. But these other areas that I talked about and pockets of tech I want to be into. We'll talk about that in a minute. Steve, this if nothing else, it raises the stakes for Friday, doesn't it? want to be, but these other areas that I talked about and pockets of tech I want to be into. We'll talk about that in a minute. Steve, this, if nothing else, it raises the stakes for Friday, doesn't it? With the jobs report, the Fed is obviously going to be highly in focus here.

I joked on halftime today that if it's a lousy number on Friday, you're going to come on the show with a bar chart that shows it going like this for expectations for June. Yes. Is that a joke, Scott? Is that past June. Yes, is that a joke Scott? Is that past for Federal Reserve monetary policy humor on CNBC? It's the only place you can find it. I've got plenty of those. But anyway, first of all, I want to make a point,

which is that I agree with Stephanie on the current shape of the consumer. And this is by way of answering your question. The consumption numbers, the saving numbers, the income numbers, they're good. If we can maintain the current levels that we have out there, even a slight rise in the unemployment rate, I don't think would be 100% critical

for the overall US economy, especially, what I am watching though, are people's concern about their jobs. It's a statistic that I think is super meaningful. And when people get worried about their jobs, that's where statistic that I think is super meaningful. And when people get worried about their jobs, that's where you want to watch the big ticket items. It's another reason to be worried about things like auto sales in the months ahead.

But you're right. The jobs number is the critical element, I think, that could lead the Fed more quickly to be less concerned about the inflation problem from tariffs and be more concerned about what's happening in the job market. I think they'll look through maybe one, maybe two employment numbers if they're lousy, if there was the result of, I don't know, one-time shifts for example in the federal government, those sorts of things. I don't think it'll be a big deal, but they'll

watch the private sector. Today's ADP number at 62,000 was perhaps a warning sign that the private sector is stuck And once again agreeing with Stephanie jobless teams tomorrow I think are very important because we have not seen the firing We haven't seen the hiring what we've seen is that business is frozen amid the uncertainty and this is a reason I'm sorry If you look at my GDP outlook here from our rapid update Scott Which we did last night,

to take a look and get a better beat on what was expected today. But what you see is you see the snap back in the second quarter, but the debate right now is, and this is the change from January before the president took office, you can see the downgrade. It's that back half of the year that I think the analysts

and the investors are puzzling over. Are valuations right? Is that GDP number right? And then I think there's also some talk about whether next year could see a rebound from those two. So there's a lot to put in there, but I just want to show you that the outlook now among the 10 forecasters that we're following here,

Scott, is pretty downbeat for the second half of the year. And we've got a couple quarters of noise in front of us. Yeah, I still think there's a fair amount of optimism for us through the trees. It's the point of getting from point A to B. Steve, thanks. My pleasure. Well, I appreciate you being with us

in this conversation very much. Dan and Steph are gonna stick with us because we are getting ready for Meta and Microsoft. Those earnings in overtime tonight, our experts Julia Borsten and Steve Kovach are with us. Julia, we start with you for Meta and Microsoft. Those earnings in overtime tonight. Our experts Julia Borsten and Steve Kovach are with us. Julia, we start with you on Meta. Well Scott, there are two big questions for Meta, AI and the ad market.

Investors are watching whether Meta sees weakness in ad spending and how much a China trade war could cost the company. And Moffitt Nathanson estimated Meta could lose $7 billion in Chinese ad revenue. And then there's Meta's big bet on AI. With its first AI developer event yesterday, Meta launched a standalone Meta AI app,

which has since then shot to number three in the iPhone app store. Morgan Stanley is saying, quote, we see the Meta AI app as the next key product to monitor as to whether Meta will make progress in building what could be a multi-billion dollar incremental, agentic-driven search business. The company's revenue growth in the quarter as to whether Meta will make progress in building what could be a multi-billion dollar incremental agentic driven search business.

The company's revenue growth in the quarter is expected to slow to 13.5% down from the 21% reported in the fourth quarter, while earnings per share are expected to grow 12%. Scott? All right, we'll see. And we will see you in overtime with those numbers. Now to Steve Kovac with Microsoft. What do we need to see here? Yeah, just a few things to watch out for on this report,

Scott. First of all, the data center buildup. We know Microsoft has pulled some plan spending over the last several months here, and the question really is how much of that is giving up the exclusive cloud deal with OpenAI versus other factors like economic uncertainty and tariffs. What's the nix there?

I suspect it's more on the OpenAI side, but we'll find out. Look, plus some commentary on those CapEx plans after the June quarter. That's when the new fiscal year begins. We already heard from the CFO at Microsoft to expect growth to slow down there. Next up is Azure growth. That's the cloud business, super important of course,

especially how much of that growth is related to artificial intelligence. Last quarter it was 13% was due to AI, so we'll see if that continues to grow as we've seen over the last few quarters you're looking at right there. And then finally, but related to what I just told you, expectations for Azure growth moving through the rest of the year.

Is this another 2022 moment when we saw cloud spending slow down with all the macroeconomic uncertainty? Remember three years ago, we were talking about recession fears. We saw Azure slow down dramatically as you're seeing on the chart next to me there, Scott. So we'll see what to expect from the CFO on the call. All right, a good setup as well. Steve, thank you. Steve Kovac. Now let's bring in Bryn Talkington of Requisite Capital Management, also a CNBC contributor. Steph and Dan, of course, are still with us.

Bryn, you're the Microsoft shareholder. So you go first. Are your expectations high? Because this stock had done poorly, not so bad of late. I think it's the best performing of the Mag-7s year to date, as a matter of fact. Yeah, but it was, with ex-Tesla,

I think it was the worst performing last year, right? So you had a big lag relative to the other hyperscalers last year. And you know, what we really want to hear is first of all, Amy Hood said in last quarter's call, she's a CFO, that cloud revenue and cloud revenue would grow towards the second half of the year. So are they going to confirm that they're going to see

an acceleration in that cloud growth? And as Steve pointed out, I think within Azure cloud services was 31%. That AI is 13 percentage points of that. And just look, that's a double from it, like, basically a year ago. And so I think with this company, you have 11% revenue growth expectations with 10% earnings growth versus let's say an Apple which is a 2% and or 0 and 2% and so I think that this is going to be a solid report but what we want to hear once again is is Amy going to come out and reaffirm that acceleration in the back half and as Satya talked about before they are going to invest their capex based on ROI and based on the economy.

So I really wanna hear what he says and his state of the union around the US economy as it relates to AI and their capex spend. No doubt about that. Dan, before we get to meta with Steph, AI affirmation, I think is what we need to hear from basically everybody in this space in terms of the belief and the spend. I think that's right I mean I mentioned earlier there's been smoke out there that so-and-so is delaying some

data centers spilled or so-and-so is trying to get out of some leases and and considering again how important this theme has been not just the mega cap but but mid and some other names as well. Some affirmation or, yeah, some affirmation that, hey listen, sure we're gonna pick and choose where we invest but ultimately we're still on course here I think is crucially important and I would argue even more important than the tariff story. Yeah, I mean off the 52 week high,

Microsoft is 17% and Meta, Steph, is 27% off of its 52 week high. What does it have to prove tonight? A lot, but it is down 27%, as you mentioned, from its highs. Numbers have been coming down. Target prices have been coming down. It is related to what Julia said in terms of China

and the tariffs, which is 11% of total revenue. It's also about ad spend. But I would say that I thought Alphabet was a positive surprise for me, at least last Friday on ads. It was actually in line, and that's maybe all you needed at that point, right? So that's going to be a big one. I think we're looking at a bogey at 41 billion for the first quarter, margins at 36.4 for

the first quarter. Second quarter guide, obviously very important. 41, again, the bogey on revenues, and also same kind of similar margin story as well. But then you're going to shift to OPEX and CAPEX and do they make any changes? And I don't think they are. So 114 to 119 billion in OPEX and 60 to 65 billion in CAPEX. But those are going to be numbers that are very, very highly watched. I think a lot of bad news is in the stock. That's why I've been adding to it and I bought back into it about a month ago. So, you know, I think that they do have a lot to prove,

but I think it'll be, there'll be definitely some green shoots. I found it interesting that during Julia's appearance on Half Time Today, when I said, you know, what are the most important things that investors in Wall Street are really gonna be keyed on? And she went down the list and regulatory was nowhere to be found. You just went down your list and regulatory issues was nowhere to be found. You just went down your list

and regulatory issues were nowhere to be found. Does that suggest that it's all noise, that no one actually thinks there's gonna be a major decision to come out of that? I think if there's a major decision and they have to spin out their pieces, I think it's worth more as separate entities. So I don't think it's all that bad.

It's an overhang for sure. That's why the stock trades at 17 times earnings. The stock is always in the sort of ballpark of being cheaper along with an alphabet relative. There's a lot of people who... But historically I mean it's traded at 23 to 25 times. 17 is real cheap. There's a lot of people who want Instagram on its own. Yeah, of course. How do you feel about the regulatory issues over this this whole group? I mean, because they certainly have gotten louder,

maybe louder than people expected in the current administration after the presence that a lot of the CEOs had at the inauguration, the donations that many and their companies had made to the effort as well. Listen, and Mark has been on, he was just on Theo Von's show, so I mean, he's doing the types of type of the rounds. He's making the rounds

I listen the way I equate the regular to answer your regulatory question if I've got the flu That's not great. But if you shoot me in the shoulder, I've got bigger problems. You're not gonna be asking you about the flu anymore Bryn you've got Microsoft Apple Nvidia Tesla and the queue. So you have a lot on the line with this group Microsoft, Apple, Nvidia, Tesla, and the Q. So you have a lot on the line with this group. Yeah, absolutely. I mean, and Robinhood. But I think that, you know, with Nvidia, Nvidia's in the garage right now.

It's gonna be in the garage this year. I think the geopolitical overhang is just real. So we just gotta sit through it like we did in 2018. I think Microsoft's gonna do better than Apple. I think Meta will do well, by the way. I don't own it directly, but I think what a lot of people are missing is I have multiple pairs of the Meta Ray Bands, and they are evolving that and making it so useful every day.

They're not going to get multiple expansion on the Meta Ray Bands, but I do think that gives you a sneak peek into actually what they're doing and how interactive it can be. It can do memos. It can tell you what you're seeing. And so I think META's really moving forward with LAMA as well as the AI initiative. And you see that through those META Ray Bans. All right, we shall see. I appreciate everybody.

Thank you, great conversation. Steph, Dan and Brynn, we'll see all of you soon. By the way, we have another big interview coming up to tell you about, from META, Evercore ISI's Mark Mahaney. He's gonna join us a little bit later. Tell us exactly what he is going to be watching more than anything else. First though, we send it to Pippa Stevens for a look at the biggest names moving into

the close today. Hi, Pippa. Hey, Scott. First Solar is sinking after posting a mixed quarter and cutting its guidance in light of trade uncertainty with CEO Mark Widmar saying the tariffs pose a quote, significant economic headwind to the company's manufacturing facilities. The company now sees full year earnings between $12.50 and $17.50. That's down from a prior guide of $17 to $20.

And Seagate is the top S&P stock after posting strong earnings for the third quarter and issuing upbeat guidance. The data storage company got a boost from Wall Street firms this morning with analysts and Morgan Stanley saying earnings were even better than expected, adding that they remain bullish heading into the company's analyst day. Those shares up 10%. Scott? All right.

But thank you. Back to you soon. We're just getting started up next. More on the pullback in stocks today. Yes, we are off the worst levels of the day. We're still red. We also have the CEO of Texas Capital Bank, Rob Holmes. He's going to be right here post night.

We get his thoughts on regulation, the economy, the first 100 days of the Trump administration and more next. Welcome back. One hundred days into the Trump administration and the banking industry still waiting for promised deregulation between that and the trade war. CEO is having a tough time predicting what the months ahead will look like. Rob Holmes is the chairman, president and CEO of Texas Capital Bank. He is with us today at Post Nights. Good to see you.

Thank you, Scott. It's good to get your perspective through all this, through the first 100 days. It hasn't gone as many people expected. You included? Been quite eventful. We did a business survey. We surveyed 1,000 business leaders and CEOs across the state of Texas. It came out in January.

They were very, very optimistic. They, 50% said the national economy was gonna thrive. 80% said the state economy and the national economy was gonna thrive. About 72% said revenue was gonna go up. And over 60% said they were gonna hire. You compare and contrast that to the information that came out Monday with the Dallas Fed Survey, manufacturing survey, and shipping orders

are down, shipping's down, orders are down. What's up is raw material prices and uncertainty. Have you ever sort of run your business through the level of fog that many CEOs are feeling today? And do you have any indication in your own mind when you might get a little bit more clarity on where things are going? Well, fog is a good word. The uncertainty index is very, very high and what we do is we carry an abundant amount of capital. So we have sector-leading CET tier one capital and our tangible common equity, tangible assets

is 10% which is also very, very high. We run the bank in a very conservative approach. Having said that, it is affecting decision makers. You see people investing less in inventory, accept those that are bringing inventory purchases at Ford and certainly capital markets, borrowing and investing in CapEx and M&A is on hold. Loan demand, the real view of the real economy from your perspective in the Dallas area. What can you tell us first about loan demand? Loan demand, we're by some counts the largest lender to Texas business of any Texas-based

bank. So, I would say that we like being in Texas, right? There's more jobs created in Texas each of the last three years than the other state. We have more people working there than live in 46 states. And the population growth is immense. The last two decades, we've had more population growth than the other state, including last year. It's always where you do want to be.

Our loans grew last year about 4%. Year over year quarter, first quarter, for the full year last year they grew 10% deposits grew 13 so we're seeing loan demand but that was a different world than we're living in going forward right and so the vast majority of capital markets transactions and new loan demand last year even was for refinancing it's not new capital the vast majority of those who are looking for loans from you I would assume you correct me if I'm wrong obviously, small business? No, no, no. Medium sized business?

Or are you talking like the biggest of the businesses in the area? Well, we led the largest soil managed debt deal in the country two years ago. We did the same last year. We're a top 10 arranger of syndicating back debt for middle market companies in the country. So our view is pretty broad and wide. Rates. Obviously the market was unsettled by the move higher and the quick move higher in rates and unsettled nature of the bond market. Where are rates going from here?

Obviously plays a direct place in the way that you see your business going. Well, in the interim there has been some upper pressure but since called November 5th the whole curve has come down and the market is actually doing the job of the Fed for the Fed. So the front ends down more than in the higher ends going up. So it's steepening and the front is down because of tariffs

and concerns about recession and the back ends going up because of government spending and inflation. So rates, our CIO thinks two cuts between now and the end of the year. I've heard anywhere from two to three. I don't think there's going to be cuts. If you listen- None at all? I don't think so, but I'm an outlier. So I think if you listen to what the Fed says when that when when they talk or you read the transcript

They're heavily favoring inflation and And the dual-prong mandate deflation and jobs. They're heavily heavily favoring Inflation and they're very concerned about the the population that have inflation has been oppressing all these years they've talked to though about the has been oppressing all these years. They've talked too, though, about the conflict, if you will, of the mandates. And if you start to have a labor market that deteriorates, they could find themselves in a precarious position of trying to make a decision

whether they should cut rates at a time where, as you said, inflation is obviously still elevated. How do you view that? I view that as they're going to need hard data and facts, and it can't be the soft data. So consumer sentiment and that data, I don't think that...I think they're going to have to have hard facts to rely on. They cannot get this wrong. You're just not a small bank, a small regional bank. I mean, you're building out a full service bank, banking business.

Investment banking business, you're in the process of still building that out. So when we come into the year thinking, well, animal spirits, deals are going to be everywhere, there's going to be all this capital markets activity that hasn't materialized. What's your view? So that's why we did what we did. So I think it's gonna be very, very hard for a NIMB Bank, a bank that relies on just net interest margin, to earn its cost of capital through market rate cycles. I think you have to have other products and service

to be valuable to your clients and earn your proper return. So you're right, capital markets is down, syndications fees are down, FX is down because the general capital markets investment banking is down. However, our Treasury business grew 22% last year, year-over-year first quarter. Cash payments 11%, wealth fees are up 11%. So between the NEMA expansion and the other parts of the business are doing well because we have multiple sources of revenue, we've been able to move forward in a constructive way. You have more hedges, if you will, within your business.

We have more ways to provide solutions to our clients to make us more valuable to them. Do you have, last question, an idea of when you think that the deal market is gonna pick up? Well, the debt markets are open. They're about 100 bips higher than April 2nd it seems. So you're paying paying a little bit of spread but they're certainly inside of the highs and spreads. But I think you're going to see the markets open up and we have certainty and the certainty is going to be

two three four five of these trade deals announced. Thanks for spending time with us. You tell Mr. Fisher and Kaplan that we said hello. I'll do so. Our friends down in the Dallas area. We for spending time with us. You tell Mr. Fischer and Kaplan that we said hello. I'll do so. Our friends down in the Dallas area. We'll see you soon Rob. Thank you. Thanks, Scott. Rob Holmes joining us right here post night.

Coming up, Metta's moment of truth. Shares are lower ahead of earnings at the top of the hour in OT. Super analyst Mark Mahaney standing by with the key numbers you need to watch when we come back. We're back. Metta shares down 27% from their February peak ahead of earnings in OT tonight.

Let's bring in Evercore ISI head of internet research, Mark Mahaney, with what we need to watch most of all. How are you thinking about this going in? I think the bar is going to be relatively low. I think people saw the Google results and maybe the snap results from last night and are very concerned for good reasons about the about the advertising outlook that that that that is going to give I don't think they're going to withdraw guidance I think they'll give you guidance for the June quarter it'll probably be a broader range Scott than they normally do probably be three to four billion dollars you know range I don't think they'll

change their capex guidance for the full year I think they're going to keep right at that sixty sixty five billion maybe they shade down some of their expense guides I don't think they'll change their capex guidance for the full year. I think they're gonna keep right at that 60, 65 billion. Maybe they shade down some of their expense guides. I wouldn't be shocked by that, but that's a possibility. But anyway, I like the stock here. I like it going into the print. I'm gonna go out on a limb here. I think that at less than 20 times earnings, I think it's nicely dislocated and it's a high quality name. I think it's gonna be one of the best performing, relatively, ad assets out there,

almost irregardless what happens later this year. You got a tough job. I mean, all of you do who follow the stock and try and put a rating and a price target on it, just because of where we are in the fog of the trade war and everything else going on. I mean, do you feel like you almost need to take the guide at this point with a grain of salt?

Because three months from now, who knows? I guess so, but I think there's a lot of, there's a lot of resiliency to the meta model that may be underappreciated. Let me throw a couple of ideas by you. First is, you know, this is one of the two largest performance marketing direct response advertising platforms out there.

You only pay if you get a sale. Companies are going to want to still generate sales. And so I think that gives them a little bit of resilience. Secondly, I think a lot of their ad inventory is fungible, substitutable. And so it's not keyword dependent and it's not content dependent. They're going to put ads in front of you when you're in your newsfeed, when you're in your reels based on your interest. And so they can swap around.

If there's weak ad verticals, they can swap in some that are stronger. There are some that are stronger, financials, for example, or a media and entertainment gaming. There are some verticals that still seem to have some strength. And then finally, I think some of this China exposure that I think investors are concerned about with Meta, I think is somewhat overstated. Yes, it's about 10% of their revenue comes from China-based companies,

but those companies are still selling, they may not be selling into the US, but they're still selling into Europe, Latin America, et cetera, they're using Metta to get there. There's also this little bit of an interesting hedge. The worst things there are between the US and China, the less chance of a TikTok actually staying into US,

and that's gonna be a source of funds, I think, for Metta. So I think there's a little bit more resilience to Metta than the market makes out. That's why I like it here. I was going to come back and say, well, China, you said, substituteable in terms of ad. I was going to say, well, China, China ads are not substitutable. But do you think they can do enough in other regions of the world to make up for whatever downside? A 10% perhaps comes from that area?

Scott, you're right, there's risk, but let's take those numbers. So if it's 10% of the revenue to Meta, it's not 10% of all that spend's going to the U.S. You know, it could be half of that China-based retailers advertising that's going to Europe or Latin America or other parts of Asia Pacific. This is not the only market in which they sell in. So it's not like it's a full 10% that's at risk. Secondly remember Scott this is an auction market so it's not like you just completely

evaporate the 10% what happens is the second bidder and the third bidder are going to come in and take that inventory. So you're going to have a little bit of pricing pressure but it's not like you're going to lose all of that ad revenue

so I just think there's more resiliency as an auction market performance based auction market, performance-based auction market with global exposure, with pretty much every vertical under the sun operating in meta. I just think there's more resilience than the market believes right now. You're the third person I've talked to today

about this stock going into the print. Regulatory doesn't even make the list. I'm somewhat surprised. Do you not think that's a serious issue? No, it's a serious issue and I don't want to be fully respectful of it. Personally, I find it a little surprised. I think the government's case is pretty slim. The DOJ's case is pretty slim. There's clearly competition in social media. I mean, you can see that when Facebook goes on and off and TikTok goes on and off.

You can see where people go. And to think that there's a case against Google that doesn't list TikTok as a competitor just seems just as somebody in the industry seems odd to me. Seems extremely odd. But anyway, this will go on. My guess is and the people I've talked with who know a lot more about law than I do, that the government's case against the antitrust case against Metta is pretty weak. There will be other regulatory issues. I think Google's got much more regulatory risk on this front than Metta does. So yeah, I think

it's a risk, but I think it's more than priced in at this level. Okay, we'll leave it there. Mark, thanks. Mark Mahaney. Thanks, Scott. Coming up next, we check the biggest movers into the close today. Pippa Stevens back with us now to tell us what she sees. Hi, Pipp there. Mark, thanks. Mark, thanks Scott. Coming up next, we check the biggest movers into the close today. Pippa Stevens back with us now to tell us what she sees. Hi Pippa. Hey Scott, well investors are not shopping for one e-commerce stock after earnings. We've got the name to watch coming up next.

We're less than 15 from the bell back to Pippa Stevens now We're less than 15 from the bell back to Pippa Stevens now for the stocks that she's watching. Hi Pippa. Hey Scott, App11 is sinking alongside Tech Stocks with Edgewater Research also giving a cautious outlook on the name calling for a growth deceleration throughout the year. The stock has more than tripled though in the last year. And Etsy shares are tumbling after posting mixed results for Q1 with the CFO saying the company is quote staying nimble in the face of uncertainty around the tariffs while also pointing to a quote fluid state of consumer

confidence in our core markets. Etsy also took a roughly 102 million dollar impairment charge for its sale of instrument marketplace reverb. Those shares down 6%. Scott. Thank you very much. Still ahead, Starbucks get roasted today having its worst day in nearly a month. We bring you the details after this break. All right, coming up next, you're set up ahead of Robin Hood earnings and overtime as well. The market zone is next and the Dow has just turned positive.

We are now in the closing bell market zone CNBC senior markets commentator Mike Santoli here to break down these crucial moments of this trading day. Plus Pippa Stevens on Starbucks selling off after its earnings miss. Kate Rooney looking ahead

to Robin Hood in OT. Mike we're positive on the S&P we're positive on the down the Nasdaq's threatening. It's fascinating I mean the big questions are unresolved and the markets trading as if they are unresolved we're trading at a 2 percent

range in the S&P today. Clearly you don't want to see a negative GDP headline quarter on the other hand it was not as bad as some estimates not as bad as GDP now and of course we're still in the zone where maybe rollback on tariffs still rescues what economic resilience we have. Also just tactically the the market had a little bit of unfinished business we were close enough to that April 2nd gap that was left in the chart after the tariffs we

literally just closed it it was 55.71 was the low from that day. So we're kind of still just playing around this zone. Two-year note yields, crash mode. Seven-month low. Market thinks that we have a growth scare and the Fed might have to come rescue it. Oil doing something similar. So for now, stocks are okay with it.

Breath has been negative. But I do think that month-end stuff will get clear of it and see what maybe the real demand is for stocks. All right, come back to you in a minute. Starbucks not okay today, Pippa. That's right, Scott. So they missed on the top and bottom line with the company reporting a fifth straight quarter of declining same store sales as its turnaround plan pressures earnings.

Still CEO Brian Nicol telling CNBC today, a lot of the turnaround progress is happening below the surface. I'll be transparent and I'll tell you, right now the results weren't great, but I love the progress that we're making on the turnaround. In the near term, the earnings will lag, but longer term, my experience has always been if you drive growth, you do the right thing

for the customer, our partner, the financial performance comes with it. Nickel added that Starbucks continues to be a strong brand in China, which is their second largest market outside of the U.S. Comp sales there were flat during the quarter, the stock down more than 5 percent. Scott? Pippa, thank you very much. Pippa Stevens. All right, Kate, what about Robinhood?

All right, Scott, so investors are expecting a surge in trading activity amid all of the volatility we've been seeing and been talking about. The main question, the focus for today is going to be how does the brokerage firm grow beyond some of these volatile market moments and this uncertain macro backdrop? So Robinhood does disclose monthly trading numbers. February, March, those aren't going to be much of a surprise. Investors are going to be more focused on what happened in April. And then any sort of guidance, any sort of color and real time update on the state of

the retail investor revenue per user is key, how they're going to be monetizing each account, total funded accounts that tends to show any potential progress on taking market share from other firms. Also gold subscribers, Mizuho among those pointing out crypto spreads is another area to watch transaction based revenue Is still the main source of income for Robinhood. Always interesting to see that breakdown Options cryptos versus equities and then any progress around diversifying revenue is also going to be Okay, Rooney. Thank you very much the animation roles the sound effects play we got two minutes left and Microsoft and meta looming

Yeah and maybe another reason that people don't want to lean too hard against the market is because one of the reasons that you pay a premium for these stocks is they're not supposed to have that much drama on a quarterly basis, they're supposed to be predictable, they haven't been. So we'll see if expectations are low enough. Microsoft's kind of paid the price for a little while here. The other piece of it, and this connects to Robinhood's report coming out,

which is the retail trader has become activated again. And you saw it in the Tesla win streak that's ending today. Every single day, there are these like six stocks that trade for less than five bucks each, they trade 40 million shares a day. That game is back on. And it's so hard to predict,

because it's not really driven specifically by tariff news, by the macro data, but it is injecting just a little bit of energy of some kind into this tape. So I do think you have to be mindful of that as we're churning through all the earnings. Best S&P name in the month of April, to your point, I think, Palantir. Yeah. It's in that mix.

That's exactly right in there. And so you know it's not to say that those traders are right or wrong but it's been very interesting to me and you even saw it in the regular old retail ETF flows that it really they didn't blink during that downturn at least not in a pronounced way. And so whether you take that as contrary and whether you take that as contrarian with you take that as complacency you take it as this is a solid source of bid in the market the leverage ETF all that stuff has really come back out there and say people did not get fully despondent near the April 7th. This market has had a day. Interesting why I think.

So Dow and S&P, looks like GoField is positive. NASDAQ will be right to the wire. Mike, thank you. The two of Metta and Microsoft do an OT. And that's where we go with Morgan and John.