Closing Bell - Closing Bell Overtime: OMB Director on Budget Bill Passing Senate; Booking Holdings CEO on Travel Demand 7/1/25

Episode Date: July 1, 2025

Washington wrestles with the latest budget bill. Our Emily Wilkins breaks down the latest, followed by reaction to the Senate passing its version of it from OMB Director Russell Vought. Paul Hickey of Bespoke and Jose Rasco from HSBC weigh in on the market setup heading into the second half. Banks begin unveiling capital return plans—Leslie Picker tracks the headlines. Booking Holdings CEO Glenn Fogel joins on the travel boom ahead of July 4th and what he is seeing for summer. 

That bell marks the end of regulation. Top build ringing the closing bell of the New York Stock Exchange. Real messenger doing the honors at the NASDAQ. And stocks mixed after two days of record closes for the S&P and NASDAQ. Materials and healthcare where your leaders, while communication services and tech lagged. The Dow now about 1% from its all-time high. Tesla in the red after Elon Musk's feud with the president picked up once again with the president saying, those should look at the subsidies Tesla is getting from the government.

More on that ahead. And a negative day for the semiconductor stocks. Arm, AMD, Broadcom, and Nvidia all down more than 3%. The housing trade is higher though. The construction ETF posting its best day since early May after breaking a four-month losing streak. Lennar, D.R. Horton, LGI Homes, Lowe's and Sherwin-Williams among the winners. And a bullish day for retail stocks. Abercrombie & Fitch, RH, Target and American Eagle with solid 5% or more gains.

The retail ETF XRT posting its best day since May 12th. And the casino stocks among the leaders in the S&P following new data showing a surge in activity in Asian gaming hub Macau. Well, that's the scorecard on Wall Street. Welcome to Closing Bell Overtime. I'm Morgan Brennan along with John Fort, reunited. Coming up on the show after the Senate passed the President's big, beautiful bill, we're going to talk to OMB Director Russell Vogt exclusively about the impact the bill will have on the debt and deficits and more.

And booking CEO Glenn Fogel is going to join us ahead of one of the busiest travel weeks of the year. That stock coming off a great quarter of 22 percent. But now let's get right to today's market. It was a choppy session after the markets closed out a strong second quarter. The Dow the outperformer today as healthcare led and tech lagged. Let's bring in CNBC senior markets commentator Mike Santoli. Mike, today's action interesting I guess the word is rotation, no? Absolutely and very mechanical rotation John. I say that because first day of a new quarter it almost as if if you were going to get 70% of all volume

in the New York Stock Exchange in advancing stocks, which is what you got, but you wanted somehow to engineer it, so the S&P 500 stayed about flat, well, you got to have those big mega cap growth stocks that more or less pushed us to a new record, take a break and be the downside offset to that. That's basically the story today.

We'll point out banks are also strong today. That doesn't really seem specifically the anti-momentum trade. So that's a pretty decent general signal in terms of cyclical macro message from the market. But I would just take today's action as being just almost a little bit of pruning back some of the winners and then just sort of some rotation

mean reversion into some of those laggards not with a lot of conviction but just a matter of you know let's just see if we can sort of do some trimming around the edges digestion and consolidation. We also know historically at least looking back over the call past call a decade Mike that July seasonally tends to be a very strong month. Is your expectation that that trend continues or after such a strong second quarter, one literally for the history books, could that be in jeopardy? I would imagine you do want an outright say that July's record for strength is somehow suspect at this point.

Generally when markets are an uptrend, you would want to defer to the seasonal forces that suggest that up trend would continue. But there's all these different ways to slice it. You mentioned we had a really, really strong May and June, obviously April before that as a matter of fact, and the weakest four month stretch on the calendar, believe it or not, is May, June, July, August. So you tell me, right? You can basically decide how you treat these things.

Mostly, I would say new highs are not something you would want to fade. The seasonal effect for July, it's like an average of a 1.5 or 1.7% gain. Not bad, but you almost got it already in the first couple of days. So I would basically suggest that, you know, you don't want to fight the general trend,

but be mindful of this temporary exhaustion need for break getting a little bit stretched on the upside and we're gonna get tested by some of the macro releases here obviously the jobs number on Thursday. Mike can we believe again perhaps in the small caps looking at the Russell up about a percent today where the S&P was flat but year to date I believe the Russell's still down about one and a half percent. S&P's up five and a half. So very different stories there.

Very different. I would say, you know, John, at this point, you know, Charlie Brown's running at the football again. And there's a reason to think that maybe, who knows, might be able to get the kickoff this time, at least for a while. The mean reversion has room to go, even without it being a true change of leadership here.

Probably, you gotta get more conviction in the Fed rate cut and several in the next few quarters in order for that to really kick off. Although, you're seeing other things, right? IPOs, recent IPOs starting to work, unprofitable growth stocks starting to work again, crowded shorts. If we get an M&A cycle, things can work in favor of small caps, at least to the point

where they don't completely sit out any further advance. All right. Let's see if Lucy pulls it. Mike, thanks. Well, the budget bill taking a big step forward today, passing the Senate with the help of a tie-breaking vote from Vice President Vance. Let's get to Emily Wilkins on Capitol Hill for the next steps in that process. Emily. Hey John, well yeah again the Senate very narrowly passed that Trump mega bill.

51 to 50 was the final vote on it and now of course it heads to the House where it's already facing opposition. You're seeing it both from fiscal hawks as well as members who are really concerned that they could lose their reelection if their constituents, if some of them wind up losing Medicaid. Speaker Mike Johnson, he's planning for the House to vote and potentially pass this bill as soon as tomorrow. He can only really lose three members here. If he wants to pass the bill by July 4th, he has to do all of the negotiating with the holdouts without making any changes in the bill text. If he does that, then it just starts ping ponging back and forth between the Senate and the House. But again, there are a lot of concerns here. Congressman Tim Burchett said that he's currently undecided, but he doesn't even think that the bill can clear a procedural vote

that's set for tomorrow. Listen to what he told us earlier. There's probably about a dozen that will probably vote against the rule. And if the rule goes down, it doesn't necessarily kill the bill. They, uh, that allow, that could allow some time to work on the bill and, and maybe some calmer heads will prevail. The Senate made some last minute changes to the bill before they sent it over to the House. That includes completely eliminating that 10-year moratorium on states implementing their AI laws that is out of the bill.

They also made a few last minute changes when it comes to wind and solar, getting rid of that excise tax that would have hit projects that would have had some parts from China, as well as softening the timeline a little bit, giving some of those projects more of an ability to get those tax credits. Of course, we will see if Johnson is able to get this bill through the House in the next couple of days and what it's going to take to get there. Morgan? I'll take it.

Emily, thanks. A lot of horses being traded right now, and I guess that'll continue to happen. Emily, thanks, a lot of horses being traded right now and I guess that'll continue to happen. Emily, thank you. Well, the major averages wrapped up a strong quarter of gains yesterday. S&P and NASDAQ both up double digits with tech leading the way in the S&P 500, but not all areas of this market had a great quarter.

The S&P value ETF up less than 3% while the growth stocks rallied more than 18. So, will the trend last? Let's ask Bespoke Investment Group co-founder Paul Hickey and HSBC Global Private Banking and Wealth Management CIO Jose Rasko. Guys, welcome. Jose actually though, want to start with the market impact

for better or worse of that horse trading going on in Washington right now. I know the tax cut extensions seem as a benefit, but there are also some questions about, I guess, how investors should look at deficit impacts. Between yields and stocks, what do you expect? Where do you expect this to shake out? We expect to see more volatility in fixed income. Even once they get the bill passed, whatever that looks like, we expect to see volatility in fixed income.

That's going to bleed over into the equity markets. It's done that in the last two years. But I think, importantly, in terms of taxes, what does that mean? It means that the consumer is going to be healthier than we otherwise thought. And remember, if you look at the CBO estimates, and I looked at the ones from early June, they specifically state that they're looking at these deficit estimates. It's just one, it's revenues subtracted from expenditures. They're not looking at the second order effects that taxes, lower taxes could have on the

economy and positive momentum for earnings. So that has to be factored in at some point as well from our perspective. Paul, this is probably the craziest market quarter I can remember seeing, you know, ex-COVID, March 2020, just the drama involved in it. What's the lesson for investors here, especially as we look ahead to the rest, the second half of the year?

Yes, I mean, the only parallels of this type of, you know, sell-off and snapback are, like you said, John, COVID in 2020, and then, you know, you go back to 98. Those are the recent examples. And when you look at those periods, when you see, and even further periods in the past, when you see these sharp drops and a quick rebound like you do,

it's the market realizing that whatever caused the panic was over, you know, it was an overreaction and investors were quick to come back in and bring things back to where they were. And what we've seen following those periods is you tended to see, they tended to be more the beginning of a rally than the end of the rally. And so I think as we, you know, we may see volatility as Jose was saying in the second half but I think it will pale in comparison to what we saw like you were just talking about in the second quarter so in that respect it's good and for the the worries about deficits in this bill

I mean I think you just have to look at the 10-year yield at four and a quarter and the market doesn't seem too worried about it. Jose I want to go back to this idea of second order effects and what that means for positive momentum here. Because we did see the Dow transports rally 2.8% today. At least one Wall Street analyst pointed to one big beautiful bill as the catalyst for that move because of the impact it may have positively on the economy and on the freight market specifically.

So if you think that this bill, and I realize the details still need to be worked out here not to mention the timing, but if you think this bill is going to happen, then how do you invest to capture those second order effects? Well see the second order effects it's not just the bill from my perspective, it's tariffs. Tariffs are not going to be what we saw on liberation day Morgan. And remember what the market did to earnings this year. We took it from 13, 14 to 9%. There's going to be upward revisions once that gets settled from my perspective. Second is the bill. And you have to look at industrials.

We like industrials because we're going to see the demand for AI technology, energy that is going to be built out by the industrial sector. So we think that makes a heck of a lot of sense. And then you've got the third leg, which is deregulation. And if they did regulate financials, there's more money to lend. Financials are very healthy, especially large cap banks. And last but not least is deregulating energy. And if we can do that, retail gasoline prices are about to go to their lowest level in years. That is all positive for the economy and it is positive for stocks. I agree with Paul. I think you're looking at some volatility here short term, but once these things get

resolved and once the Fed gets back in gear, there's a lot of upside here. And if you look at valuations, valuation, we usually see on average in valuation cycles at 10x multiple expansion, we've only seen less than five. We have more upside there as well. Hmm. And it's interesting. Industrial is actually the best performing sector in the S&P year to date, despite all the talk that we find ourselves having

around mega cap tech. Paul, finally, one of the stories that you've uncovered about the second quarter was the divergence in performance between growth and value. Does that continue? Yes, I mean, I think it'll continue. Investors are coming back to growth today. The growth had a weak day, but it was just a mean reversion.

We saw the biggest outperformance of growth relative to value that we've ever seen in the history of the indices going back to 1995. And I think in the short term here, you can see some mean reversion, but growth is where investors are looking and where the companies that can benefit from not just AI in the tech sector, but companies outside of the tech sector that can use AI to their advantage and increase productivity. Okay, Paul and Jose, thank you both for joining us

on a mixed day for stocks. Well, as we mentioned, the Senate passing the budget bill by the narrowest of margins, it was a tie-breaking vote from Vice President Vance. What this bill could mean in the long term for spending and debt and deficits and so much more. Joining us now from the White House in an exclusive interview is Russell Vogt, director of the Office of Management and Budget and director of vote.

It's great to have you on overtime. Welcome. Thanks for having me. So let's start with the fact that we did have one big beautiful bill squeak through the Senate. It's going back to the House now. Can this bill get to President Trump's desk by the end of this week? How important is that deadline?

I think so. I think it's important to stay on the timeframe that the President has put forward. We made a lot of progress this week in the Senate and we're looking forward to having ongoing conversations with conservatives in the House and others to get this thing done this week and to get it to the President's desk. The Senate version of this bill changes the math on cuts versus spending. How are you calculating that, especially when folks like the Committee for Responsible Federal Budget are saying that this is going to add over $4 trillion to the national debt through 2034, which would be $1 trillion more than the House

passed bill. Again, the fiscal watchdogs on the outside are playing artificial games with the baselines. They're choosing to not assume current tax relief that is in law. Now, the Senate goes further than the House did in providing additional tax relief. One of the things they do is to provide more certainty to businesses by having the business tax cuts extended for a longer period of time. But that doesn't reduce all of the the fact that they have 1.6 trillion dollars in mandatory savings in the bill that more than pays for the additional tax relief that is provided in any

spending in the bill. So this is a net deficit reduction in this bill, and it's something that is fiscally responsible. $1.6 trillion in mandatory savings. Again, the biggest thing we've ever seen is $800 billion in 1997, and this more than, this doubles that in this one bill. It is a historic bill. It has all of the things that the president ran on. We need to get it to the president's desk. So Elon Musk has been very critical, continues

to be critical of this bill. I think escalating rhetoric aside, be it the subsidies or new political parties, etc., his fundamental criticism has been that this bill is going to balloon the deficit and increase the debt. Some of the holdouts we've seen, Republican lawmakers in both houses have been making similar arguments as well. I realize you just talked about 1 trillion, 1.6 trillion in cuts, but how do you respond to, how do you respond to those folks? Again, I would just continue to point out the degree to which this bill has deficit reduction and historic mandatory savings. Regardless of what the other things that are in the bill,

border security, defense spending, historic tax relief, this is an incredible bill as it pertains to just fiscal responsibility. And this isn't a budget bill. This is the entirety of the first year's agenda on behalf of the president. So this is enormous step forward. We haven't had anything like this

for 30 years. We put $1.6 trillion in mandatory savings for the first time since the 1990s and somehow this doesn't move the ball forward. We've had futility in this town for decades. This bill changes that. I hear you and what you're saying there, Russell, but I believe the American people are also concerned with what the philosophy here is when it comes to government employment and slimming it down. Is this extreme weight loss that's healthy, or is this an amputation? We're hearing about scientists, data analysts, specialists being released or discouraged. Air traffic control clearly needs funding.

What's your philosophy and approach to government work that is certain to make sure that it's efficient and not just eliminated? Sure, and again, those are discussions that are totally unrelated to the reconciliation bill, the one big, beautiful bill. What you're referring to is our efforts to downsize and to make more efficient the federal government. And what I would say is we have gone after the bureaucracy that is woke and weaponized.

We are not going after the legitimate parts of government that we just want to make better and to do the things that a federal government should do. But we also know that every agency has kind of had aspects of it, parts of his bureaucracy that have been aimed at the American people and just wasteful and also given over to CRT and woke ideology and we've put forward in our budget for next year 163 billion dollars in cuts the lowest since 2017 if you ingested for inflation

the lowest for 2000 and we're going after that it is it is all surgical it is not meat acts and it is something that we believe the American people are resonating with it because they have been subject to this type of bureaucracy for the last several years. It's worth restressing here that you cannot include discretionary savings via, for example, doge cuts in a reconciliation package. Very specific. And I know you've talked about this numerous times. Very specific rules about what can and cannot be included in legislation such as that that we're seeing go through Congress right now.

You have started to send rescissions packages to Congress. Is there an appetite from lawmakers for more? There is. We passed out of the House a $9.4 billion dollar rescission cut package that is largely the Corporation for Public Broadcasting billion and then the rest of it is foreign aid, the worst aspects of foreign aid. We're having very good conversations in the Senate. I expect the Senate to move that package after they catch their breath from the reconciliation

bill and once that passes, we're more than willing to send up additional rescissions package. We do want to see it passed because it impacts procedurally the flexibility that we have to use other executive tools that are at our disposal. So we are very committed to making all of the Doge savings and other things that we have found permanent and we are in the process of doing that. But if you're focused on this week's news, you're gonna be focused on the reconciliation side, and it's really important to remember, this is just one aspect of our cost cutting initiative,

just one, we could talk about tariffs bringing you three trillion dollars, we could talk about the discretionary cuts that are in play. In our first six months, we were racking up enormous historic wins as it pertains to getting to, on the road to balancing the budget. It's just each step, each step.

Yeah, let's talk about tariffs, especially because we have some of these trade deadlines kicking in as soon as next week. We did get those numbers more than $100 billion released yesterday tied to tariffs and custom duties that have been collected since President Trump took office. How much does that factor into the budget? How much does that factor into your outlook for the budget, not only this year but beyond? A lot. Right now we're on a schedule for about three trillion dollars over 10 years. This is at the liberation day pause levels and so we're, very excited about where we are with regard to

our tariff revenue and we only think that will increase. And so this is a major and new feature of our fiscal planning. This is not something that you have seen in quite some time. President Trump is making another paradigm shift by having this be a part of the conversation about balancing the budget. And I think what you're seeing is people, particularly on the Hill, be more receptive to this because all of the fear tactics that people have brought with regard to this subject are not coming due, are not coming to fruition. And as a result, we're able to begin to plan, and we're seeing it in real time as the President has articulated with the latest numbers since we've come

into office. OMB Director Russell Vogt, thank you for joining us. You bet. Well, just when you thought the dust had cleared on the Trump-Musk feud, ding ding, round two. Tesla, a big drag on tech today, down 5 percent. It's sixth straight down session. Can the stock recover if this war of words between the president and Musk continues? And we are moments away from hearing how big banks plan to return cash to shareholders

Following the results of those Fed stress tests over time is back into Welcome back to overtime. Constellation Brands earnings are out. The stock is down about a percent. Brandon Gomez has the numbers. Brandon. Yeah, off some lows as well. A miss on the top and bottom line.

EPS coming in at 322 compared to 331 expected revenue coming in at 2.52 billion below the 2.554 billion that was expected. Fiscal year EPS guidance though did come line, ranging at 1260 to 1290. Beer revenue was a slight miss. Wine and spirits, a wider miss, 281 million compared to the 301.5 million expected. Now, the CEO in the release did say, we continue to face softer consumer demand, largely driven by what we believe to be non-structural socioeconomic factors. Now, John, that might be referring

to the Hispanic American consumer that makes up 50% of beer sales for Constellation. The company has mentioned unemployment rates for the community, as well as the impact of Trump's immigration policy on the community and social gatherings. The call is tomorrow at 10.30 a.m. We'll be listening in,

and I'll be sure to bring you more color then. All right, Brandon Gomez, thank you. Thanks. Well, Lululemon is suing Costco. We're going to give you the details on this, perhaps unlikely legal battle coming up. That's not a stretch at all. And we're ready to hear from big banks about their capital allocation plans. What are they going to do with all that money now that they've passed the Fed's stress

tests? Over time, we'll be right back. Welcome back. Shares of Lululemon higher today. The company is suing Costco alleging it sells Lululemon knockoffs or dupes. Lulue seeking monetary damages from lost profits, claiming it has has suffered quote significant harm unquote to its brands and reputation. One example from the filing shows Lulú's famous ABC pants compared to Costco's Kirkland 5 pocket front pants. Costco did not immediately respond to CNBC's request for comment

but Morgan this entire fight looks like a knockoff of all birds versus Amazon from a few years ago to me. That's a throwback reference right there. Well it's time now for CNBC News Update with Kate Rogers. Hi Kate. Hi Morgan. The Trump administration is planning on moving the FBI's headquarters from its current location to the office space formerly occupied by USAID. That's according to sources who told the Washington Post that the move will keep the FBI in downtown DC after earlier efforts to move the agency's headquarters outside of the nation's capital.

The U.S. has charged two Chinese nationals for acting as agents of the Chinese government in an effort U.S. Navy service members, the Justice Department said today, the individuals had also worked with China's Ministry of State Security to pay $10,000 for information on US national security. And a hacker has reportedly stolen personal data from applicants to Columbia University. Bloomberg reporting that the university confirmed the hack but is working with cyber security firm CrowdStrike to investigate the breach.

The stolen data goes back decades and includes university issued, rather rather ID numbers, citizenship status, and application decisions. Back over to you, John. Okay, thank you. Well, every bank passed Friday's stress test, meaning banks can now start handing out cash to shareholders if they want. We're going to hear about their plans coming up and speaking of plans, many Americans making travel plans for this busy week. We're going to talk to the CEO of booking about what he's seeing as people get ready to head out for the summer. Be right back.

Welcome back to overtime stocks split again today, but this time it is the Dow leading and approaching record highs just 1.2% from the all time high. Healthcare leading the Dow higher. The Nasdaq though pulling back following its record run. Apple higher for the second straight day on reports that it could work with an outside

company on the AI for Siri. Amazon the only other mag 7 stock in the green today. But copper rising to a three month high as China's factory activity expanded in June, beating expectations. And it was a big day for consumer stocks. Anything you can buy, handbags, motorcycles, swimming pools, burritos, you name it, those stocks rising in trading today. It's quite an interesting day if you put all of those things together. Well, sticking with consumer spending, the TSA is saying it expects to screen 18.5 million travelers this holiday weekend. That comes after two days in just the last week

ranked in the top 10 of busiest days in TSA history. So how should investors weigh hard data versus soft when it comes to the consumer? Joining us now is Glenn Fogel, booking holding CEO. Glenn, welcome. What are you seeing in consumer mindsets at a time when many are credit stretched? What are you seeing in consumer mindsets at a time when many are credit stretched? What are you seeing in consumer mindsets toward travel and ability to spend that additional dollar

while out there? Well, thanks for having me. And look, we've seen since the pandemic, people like to travel. And it doesn't seem to matter what the economics are. You know, we have some scares about recessions over the last couple of years, and people continue to spend. You are, you know, we have some scares about recessions over the last couple of years and people continue to spend. You know, you mentioned TSA, one thing you didn't say is that they hit a new record all time high a week ago Sunday. They did over three million people were screened. I mean, these numbers are big. Okay.

Now tell me about the impact, if you can gauge it thus far, of AI on the travel experience, and not just the experience of researching or booking travel. I just got back from Bangkok, Thailand yesterday, and in navigating Bangkok, I had this really interesting to me combination of AI help and location and translation, and also human help as well.

How are travelers using that, navigating that? Can you tell and where do you see opportunity? Yeah, now this is an incredible transformational technology that we absolutely are spending a lot of time, energy, effort, money, people, and really developing some of the best tools using generative AI. For example, at booking.com, we have our AI trip planner,

which I hope you did use in Bangkok. I hope that was helpful to you. Don't know if you did or not, but those are the type of things people want. They want the help, they want the assistance. They want to make sure they're getting the best value for their trip, but then when they're actually are traveling, they want to have a tool

that will help make it easier. And it's only going to get better. I think one of the things that's being said is that today it's the best it's ever been, but it's also in the future gonna get just even better. And I see this as one of the things that we have a great opportunity because of our scale, because of the number of people we have, the capital,

and just the long-term use of AI in the past. I think we are really in the leading position for the use of gen AI. And it's one we'll continue to watch. I want to go back to, you just mentioned the numbers are big. You're talking about TSA and travel demand. A couple months ago, we started to see the softness

in airlines. It was seen as a canary in the coal mine for the broader economy, waning demand, the airlines cutting capacity. It sounds like those fears have not become reality based on what you're seeing. Is that the case? Well, I think we have to be really careful

about how we talk about it. See, one of the interesting things is we at Booking Holdings and Booking.com, our biggest brand, we are very, very global. So when I hear people talk about travel, usually they're thinking just the US, but the US is just a small portion of our global business. So when I talk about travel, I'm talking globally. And certainly it can be different areas having stronger areas, certain areas having weaker areas. But I don't look at

just one area. So we say, well, we're looking at the U.S. perhaps not as good. From my point of view, that's interesting, but I'm really looking at globally. And right now, what we've been seeing throughout the last couple of years is that people like to travel. I was in Nice last week, actually, and I was actually pleasantly surprised to find lots of people on the beach there, which is good for me.

Maybe not so great, but the people on the beach were just very crowded. So global economic uncertainty amid trade dynamics, geopolitical risk, given what we've seen with wars in places like the Middle East that hasn't been denting demand? Well, of course, any time there's an event like that, there's gonna be an impact that regional area,

but that doesn't mean for a global player that you may be better the impact. Cause somebody says, well, I was scheduled to go to the Middle East on a trip. Now I'm gonna change it. I'm gonna go somewhere else. Look, we talked about this in our first quarter call. We mentioned how Canadians all of a sudden weren't going to the U.S. as much as they used to. But for us, it didn't matter so much because we mentioned how we had an increase of

Canadians going to Mexico. So again, it's very helpful to have this global diversification. And that's something that we're very proud of. Yeah, and then of course to layer the AI capabilities on top of it. Glenn Fogel of Booking, thank you for joining us ahead of the big July 4th holiday weekend here in the US. Thank you. Well, we have a news alert on the JP Morgan and Bank of America outcomes following these fed stress

tests, Leslie Picker has the details. Hi, Leslie. Hey Morgan, yes, the two biggest banks in America are increasing their dividends on the heels of last Friday's stress test. JP Morgan authorizing a new common share repurchase program of about $50 billion effective July 1. That firm is intending to increase

its quarterly common stock dividend by about 7% to $1.50 per share from $1.40 per share. Bank of America increasing its quarterly common stock dividend by 8% to 28 cents per share beginning in the third quarter of 2025. We're continuing to get more of these releases from the big banks following those stress test results and we'll bring you the headlines when we get them.

Guys? Okay, we're looking forward to it. Leslie Picker, thank you. Well, Tesla shares tumbling towards the bottom of the S&P 500 as President Trump and Elon Musk reignite their feud over the budget bill. So up next, a top Tesla analyst looks at the potential impact for shareholders. Plus, we'll discuss what the recent sell-off and the big payroll processors could be foreshadowing about Thursday's June jobs report.

Be right back. Welcome back. Tesla today closing its sixth negative session in a row, finishing down about 5 percent. This after an escalation or maybe we should say re-escalation in the feud between Elon Musk and President Trump. Once again, Musk took to social media to share his criticisms of the spending bill, which passed the Senate today, calling it a quote, debt slavery bill. In response, Trump is suggesting Doge should look into subsidies for all of Elon Musk's companies. Doge is the monster that has that might have to go back and eat. Elon will not be terrible.

He gets a lot of subsidies, Peter. But he was very upset that the EV mandate is going to be terminated. And you know what? When you look at it, who wants not everybody wants an electric car. Well, today's move has dropped Tesla's market cap below the $1 trillion mark. It's now the worst performing MAG-7 stock of the year. But joining us now is Craig Erwin from Roth Capital Partners. Craig, your response to what we've seen and how it's playing out in Tesla's stock,

especially as we do see the removal of these subsidies, which Elon Musk has actually been pretty vocal in saying he was okay, at least earlier in the year, OK with those going away. Yeah, I think subsidies going away is actually kind of a good thing for Tesla because it's going to see the big OEMs retreat from the market. And Tesla's basically going to own this market for the foreseeable future. So their market share will go up.

The pricing will have to adjust, and they've shown the ability to pass through price pretty effectively. But the long-term dominance of EV technology, at least in North American Europe, is something that I think Tesla can look forward to with or without subsidies, but without it's a much straighter shot. So in light of that, would you be buying on the dip here?

You know, I think I would buy on the dip. We're probably looking at a very exciting earnings call. I think they're going to share with us what they're learning in Austin with the rollout of autonomous technology. I think some of the issues will start to be more clearly defined as far as what's needed for level four autonomous, which is really the key thing that Elon needs to communicate about. And then there was a little bit of hurry up about the out there.

Optimus is something where, you know, Tesla needs to get more information out there. A lot of investors are very excited about that. There's another startup that I understand went into production or pre-production this month. To frame out Optimus, they're talking to the supply chain about pricing for 30 million units. Humanoid robot's okay, that could be over the next 10 years. But there's some incredibly exciting things in front of us.

And I think Elon's back in the saddle in a big way, rearing to get everybody going and help you understand his vision. Yeah. But Craig, how much of a hero premium, right, for Elon Musk is built into Tesla stock? And how much of a policy premium is built in? Maybe the assumption that because Elon Musk

was in so close with not just President Trump, but that band of billionaires around President Trump, he was going to get more of his policy wants attended to. Autonomous, you know, federal regulation at the autonomous level probably benefits Tesla potentially more than any other single stock. And if Trump doesn't like Elon Musk anymore potentially going forward does that kind of regulation that he would like or legislation get put in a risk category Yeah, I mean autonomous technology is not strategically important to the United States, right?

What SpaceX is doing is right and their their launch services are so You know, it doesn't make any sense for Elon to be fighting with Donald Trump. You know, they both have their egos. You know what? They deserve it. They're both wildly successful men. Elon needs to step back and say, you know, maybe I don't need to say some of these things. He's a purist. I get it, right? He wants to see the most perfect bill. He wants to see America crush it going forward. So does Donald Trump. Trump's a pragmatist, right? He wants to see the most perfect bill. He wants to see America crush it going forward So does Donald Trump but he's Trump's a pragmatist, right? Trump's got a govern. He's got to get things through Congress

He's got it. He's got to pass laws So the two of them are kind of looking in the right direction looking in the same direction just looking at things differently You know, I think you know, yeah They're definitely This is real so, you know, yeah must not help himself. Okay, Craig Erwin. Thank you. Yeah Up next Mike Santola is gonna look at what the stronger than expected job openings data could mean for the June jobs report Later this week and the big payroll processors as well. Be right back. Welcome back. We've got a news alert on Centene. Pippa Stevens has the details for us. Hi, Pippa.

Hey Morgan. Shares of the healthcare company are cratering here more than 20% after Centene withdrew its 2025 guidance. This is based on the company saying that preliminary market data in 22 to 29 of their states shows that the overall market growth will be lower than expected. The company said that they expect the preliminary estimate of approximately 1.8 billion, which corresponds to an adjusted diluted EPS impact of approximately $2.75 per share. This of course follows UnitedHealthcare also suspending its outlook back in May. Once again, their share is now down about 21%. John?

Alright, Pippa, thank you. I'd also note some of the other health care providers like Molina Health and Elevance down. It looks like in sympathy here. Okay. Well, this morning we saw job openings in May coming in higher than expected. So could this report signal what's to come in this week's jobs report? Let's ask Mike Santoli. Mike? Yeah, so this is job openings going up and therefore the ratio of job openings to total

unemployed workers has also ticked higher, not too dramatically. This is what this chart shows, that ratio. It's about 1.07, so slightly more than one job opening per currently unemployed person collecting unemployment benefits. Now, the lot of, almost the entirety of the upside surprise in the openings was from the hospitality industry. There's been some speculation among economists that maybe you're seeing the impact of some of the immigration crackdowns creating openings without it being expansions of private sector jobs. We'll have to wait and see about that.

Now take a look at the shares of ADP and Paychex, the big payroll processors. This is a five-year chart. It kind of shows them rolling over just a little bit here, trying to hold on to this sort of upper end of the range, maybe showing that there's some deceleration in the labor market. We'll see if Thursday's official monthly jobs report confirms or refutes that market conclusion. Mike, you mentioned the potential mismatch coming from the immigration crackdown, and that opens up the question for me about we often talk about job openings that there aren't

people qualified for, but could we also end up with a situation where we have job openings that are jobs that unemployed people don't want? No, definitely. You can have a complete mismatch in that regard. You've seen that at times, in fact, when we did even have the reopening of the economy after lockdown and COVID,

and especially it was restaurants and hotels reopening, and it was a little bit of friction in that whole thing. So I don't know that it would be necessarily a skills issue, but we have seen, and Fed Chair Powell has talked about this, is labor supply and demand also coming down in tandem? That's why we're at this kind of equilibrium in terms of slow job growth

that's not really moving the unemployment rate. So we'll see if the numbers on Thursday maybe tip in one direction or the other for some conclusions. So is there something investors should look out for, therefore, that might be a different kind of signal than we've had in the past? Maybe things not meaning what they typically do. Yeah, I think therefore, what we're going to really look at for the headline on Thursday as we always do is total net non-farm jobs created.

That's the total growth in payrolls. So if it's a weak number, it might not necessarily be, it's been a lot of layoffs and companies are shrinking. It could just be again, this kind of stutter step in job refilling jobs that have come open. Okay, we'll be watching jobs Thursday. In the meantime, Mike Santoli, thank you on this Tuesday. Up next, we will have much more on all of the action

in bank stocks following their capital return plan announcements, stay with us. Welcome back to overtime. Let's get back to our Leslie Picker for more on the bank capital return plans. Leslie. Hey, Johnny, we've gotten a few more releases about their capital return plans following last week's stress tests. Wells Fargo announced that it intends to increase

its third quarter 2025 common stock dividend by 12 and a half percent to 45 cents per share. Additionally, the company says it has capacity to continue repurchasing common stock, which will be routinely assessed as part, the company says it has capacity to continue repurchasing common stock, which will be routinely assessed as part of the company's internal capital adequacy framework and considers market conditions, regulatory capital, and other risk factors. Morgan Stanley increasing its dividend by 8% to $1 per share. It also reauthorized a multiyear common equity share repurchase program of up to $20 billion beginning in the third quarter of 2025.

You can see Morgan Stanley shares up about 0.7% right now. I'll send it back to you, Morgan. All right, Leslie Picker, thank you. Well, let's get you set up for tomorrow's trade today. There are no earnings on the calendar, but investors will be paying close attention to the weekly mortgage applications data. Also the ADP employment

report, which could give us more clues about the labor market ahead of Thursday's June jobs report. And of course, after a historic run, or I guess we should say recovery for the S&P John, kicking off the third quarter in the second half of the year with fractionally lower trading here for the S&P today, but we're on record close watch for the Dow now. Indeed.

Interesting to me too, we talked about this earlier today on CNBC, Figma preparing to come public. This is a company that Adobe tried to purchase for $20 billion, but ran into regulatory issues. Canva has also made rumblings about coming public, both of these competitors of Adobe, but in different ways. Canva more on the consumer side, and Figma certainly more on the developer

and professional side, but Adobe is down about 12% year to date, around 30% over 12 months. Are investors underestimating Adobe or are investors just ready to invest in competitors who have a different model that could grab share? It'll be interesting to watch it play out both on the stock side and on the strategy and product side. Yeah, and of course we've seen some very strong IPOs

and companies come public with their debuts here in the last couple of weeks. And we also know M&A is starting to re-engage here as well. It's something Ralph Schlossstein talked about here on overtime yesterday, as maybe some more confidence comes into this market and for CEOs as well as we come into the second half of the year. Some of the uncertainty around things like tariffs begins to narrow a little bit. Yeah. Who's allowed to buy under what circumstances

all of that will play into the markets as well. All right, well that does it for us here at Overtime. Fast Money starts now.