Closing Bell - Closing Bell Overtime: The Fed Keeps Rates Steady; UWM CEO On Housing Impact 6/18/25

Episode Date: June 18, 2025

Markets digest the Fed's latest signals after keeping rates unchanged with David Zervos of Jefferies and former Richmond Fed President Jeffrey Lacker. Our Eamon Javers reports on the latest from the Middle East, while Sassan Ghahramani of SGH Macro Advisors assesses how geopolitical risk is being priced. Mat Ishbia, UWM CEO, weighs in on the mortgage and rate outlook. Barbara Doran of BD8 Capital joins with her take on positioning for the back half of the year.

That bell marks the end of regulation. National Conference on Public Employee Retirement Systems ringing the closing bell at the New York Stock Exchange. Slide insurance during the honors at the NASDAQ and stocks ending the day mixed. With the NASDAQ the only index higher as the Fed gave the market exactly what was expected, leaving rates unchanged. The Fed did raise the near-term measure of inflation expectations and lowered its GDP forecast. Circle seeing a big jump after the Senate passed the highly anticipated stablecoin bill overnight. Coinbase also hires as it debuts a stablecoin payment system.

Steel names on the move. Nucor hire after issuing guidance that beat analysts' estimates. On the flip side, steel dynamics lower as second-quarter earnings targets fell short of expectations. Lifted an Uber boat lower after Ramo announced that it has applied for an autonomous driving permit in New York City. And chip stocks among the leaders led by Marvell, Intel and Micron, Marvell raised its forecast for the market for custom AI chips.

Well, that's the scorecard on Wall Street. Welcome to Closing Bell Overtime. I'm Morgan Brennan along with John Fort ahead. Former Richmond Fed president Jeffrey Lacker on the feds latest rate decision. Does the Fed have the luxury of being patient? We'll also look at the state of the housing market as the latest data continues to disappoint. And what will it take for the US to get more involved in the Iran-Israel conflict? But we begin with today's Fed decision as they leave rates unchanged. CNBC Senior Economics reporter Steve Leesman was in the room for today's news conference

as he always is. He joins us now with the highlights. Hi Steve. Hey Morgan, thanks. The Fed keeping rates unchanged at 4.25 to 4.5 percent. But the Fed Chair warning markets in its press conference that the inflationary effects of tariffs not out of the woods yet and expect it to be coming soon. Every outside forecaster and the Fed is saying is that we expect a meaningful

amount of inflation to arrive in coming months and we have to take that into account. So they did take it accounting in their forecast for 2025 they lowered GDP again for the second time in a row in their forecast, three-tenths down to one-four. Unemployment rate ticked up again for the third forecast in a row, up by a tenth from prior month. The core PCE up again, 0.3% to 3.1%. But they left that two rate cuts built in. Fed funds at 3.9% by year, and we'll talk about that more in a second. This is the second forecast in a row that the Fed has predicted a more stagflationary outcome of weaker growth and higher inflation. At the same time, Powell was humble. He was clear the forecast suffer from a huge amount of uncertainty.

We haven't been through a situation like this and I think we have to be humble about our ability to forecast it. So that's why we need to see some actual data to have to make better decisions. We'd like to get some some more data. And again, in the meantime, we can do that because the economy remains in solid condition. At the least all this raises questions about whether the Fed can feel confident enough in the inflation outlook or the economic outlook to meet market expectations of a first rate cut in September. And just real quickly, we'll be able to talk to this Mary Daly about the San Francisco Fed president on this show on Friday But John I did not think this was a press conference where the Fed chair Took the market and put his arm around and said that we got you in September

I didn't get that feeling for what the Fed chair was saying. Okay. Yeah Well, we'll see what the reaction continues to be after this Steve. Thank you for more on more on the Fed, let's bring in Jeffrey's Chief Market Strategist, David Zervos, and former Richmond Fed President, Jeffrey Lacker. Guys, welcome. Jeffrey, so the Fed seems to be listening to these calls for a meaningful amount of inflation, perhaps in the back half of the year. What's the meaningful data that could counter that and still lead to a cut? Is it employment related?

No, I don't think so. I mean, if employment fell out of bed, of course they'd react, but it looks like the employment and labor market effects of the tariffs that have been implemented so far are relatively minor, smaller than expected. But keep in mind, we just have kind of a flood of uncertainty resolution ahead of us. There's tariffs in place, but then a huge range of possibilities for what tariffs might be implemented going forward. So far, we haven't seen a trace in inflation data that's meaningful or in labor market

data that's meaningful, but it's going to be maybe a peak would appear in June for the effect of some, it's mostly July, August, September, and it won't be until the September data is in that they're really going to have anything meaningful to hang their head on in terms of a Change in policy. So I think September is highly unlikely to be a meeting at which they cut rates Hmm David Zervos was this from the Fed as dovish or neutral as you hoped as we're talking about Some hours ago or is this meaningful amount of inflation expected meaningful? You know what John, I don't think at all. I think Steve was right. This was a, this was not a hug. This was a hawkish meeting. He certainly did not acknowledge the lack of changes in the inflation expectation data,

which I somewhat expected him to do. Infl inflation expectations really haven't budged. That's probably the best forecaster the tips market or the survey data and that's just not there so whether the economists get it right or not is usually we know that usually doesn't happen but I'd rather take the tips market and that said nothing and we got pretty

good inflation data since now they're pushing that to the side but I think really what's happening here John is actually- just the whole Federal Reserve apparatus and Jay himself is losing a bit of relevance completely with the market. As we realize that

forward guidance is going to be set by others not them- we have a new governor coming on board in January when governor Kugler is gone Jay's gone in I guess six more meetings now. And we are going to start to see probably more guidance coming from

outside of these conferences these press conferences and to be honest with you I think the market just yawned the market said your hawkish yawn let's go on. Yeah it's a key point markets are very calm basically every major average finished

flat either slightly to the upside or slightly to the downside, depending on what you're looking at. 10-year treasury yield basically finished unchanged on the day to that point too. Jeffrey, I am curious, just given the fact that some of the forecasts and what we saw in the dot plots signals more forecasting

towards a stagflationary environment through the second half of this year and even looking to 2026, what would it actually take for the Fed to cut rates twice this year? So I think inflation would have to come in lower than they expect, you know, in the mid twos rather than 3% or above for the, you know,

basically the end of the year, 12 month numbers. And there'd have to be a significant weakening at the labor market. I think they're of the mind that they've got a small nudging down to what they view as neutral ahead of them, but estimates of neutral range from two and a half to four and a half. So it's not obvious they're not pretty close

to neutral as it is. But I think they're going to be it would take a big perturbation one way or another to get a rate cut out of them. I think the important thing here is that the directionality of the next move isn't obvious either. I think that's a little bit underappreciated. They've shifted the outlook towards more inflation, a little less adverse growth impacts and I think that people have to be aware that there's a chance they just stay

put for a long time and maybe the next move early next year is up here upside if inflation behaves according to that scenario in which yeah there's a one time level increase but it passes through and becomes a more broader inflation surge.

David, not just this idea of, as one media report put it today, a shadow Fed taking shape in coming months with future nominations, et cetera, but the fact that the fiscal piece of policy is also driving a lot of the action we're seeing in the bond market. Even if the Fed were to start cutting rates, how much impact would it have until you see the fiscal house come in order? I think it would have a fair amount. Right now, given that the market has been given a hawkish message, it probably has some effect.

But you're right. I mean, there's plenty of variables. There's lots of other things going on affecting inflation than tariffs. I think we're spending way too much time on tariffs and not enough time on AI, not enough time on deregulation, not enough time on the cost cutting that's going to happen, and potentially labor market disruptions that are much bigger coming from technology. It is a little bit of an obsession, it seems, on the tariff side. I'm not exactly sure why.

I think our secretary of the treasury called it tariff derangement syndrome. There seemed to be a little bit of that today and a lack of discussion of some of the other more positive signs for disinflationary pressures over the long run. But I get it. We understand where this committee's coming from. I think there will be a shadow committee. I plan on kind of using a template that Jeffrey knows all too well

because we've met at a few of these events. There was a 50 year anniversary of the shadow open market committee recently at Hoover. And that was developed in the seventies to counter Arthur Burns by the late great Alan Meltzer and a few others, Anna Schwartz. And it's almost like an inverse shadow open market committee, maybe one that's sort of saying, this Fed is being a little too hawkish, and there's going to be some shadow folks

that sort of go like 50 years ago and say, you're kind of doing the economy a disservice. And we may see those people come into play a lot sooner rather than later. And I think the market would actually take a pretty big positive cue from that. We'll look for it. David, Jeffrey, thank you. Up next, the CEO of SGH Macro Advisors on how escalating tensions between Israel and Iran could impact the market and the geopolitical dynamics. Plus, House of Horrors. United Wholesale Mortgage Chairman and CEO Matt Ishbyan.

Whether the wave of bad housing data combined with high interest rates will be a double whammy for investors and for home buyers. We're gonna get his take from the front lines of the housing market. Overtime is back in two. ["The Daily Show"] Welcome back to Overtime. The conflict between Israel and Iran entering its sixth day today

no signs of de-escalation president Trump saying earlier today that Iran does want to negotiate. Eamon Jabbers has the latest details. Eamon. John that's right the president took some questions from reporters in the Oval Office a short time ago just over this past hour fact. He was having a photo op with the Italian soccer team Juventus and answered a couple of questions, one of which was about whether or not he has seen the criticism from conservative commentator Tucker Carlson about the idea of the United States getting involved in the

war against Iran. The president said that he disagrees with those conservatives who are skeptics about military conflict. Here's what he said. And they say, well, we don't want to fight. Well, you're going to have to make a choice because it's possible that you're going to have to fight for them not to have nuclear. Meanwhile, a statement from the Iranian government, this is from the Iranian Revolutionary Guard

Corps, it's a warning or threat really to the people of Israel. What they say is the IRGC aerospace divisions thunderous missiles will not allow you a moment outside your underground shelters. Either choose a slow death in the hellish life of bomb shelters or save yourselves from the 24-hour missile rain. Flee the lands your ancestors seized if you wish to survive." So the rhetoric on all sides heating up, but Morgan, you've got to say, just watching the president's photo op a short time ago,

he did feel, he just gave off a very reluctant vibe. This is a president who's clearly ambivalent about this idea of the U.S. getting involved here. He said he's got a meeting in the Situation Room coming up this hour. And he said he still has not made any final decision. Okay. Amen, Javers. Thank you.

Well, let's dig into all of this. Joining us now is Sasan Garamani, President and CEO of SGH Macro Advisors. Sasan, it's great to have you back on the show. Welcome. Thanks for having me on, Morgan and John. You know, we talk about, we talk about strategic ambiguity as policy as it relates to Taiwan. I wonder if we're seeing a version of that play out

right now in real time in terms of U.S. decision-making around leveraging this moment to get Iran to the table for more extensive nuclear negotiations versus the possibility of us becoming more directly and offensively involved in this conflict alongside Israel. How do you game this out right

now? And are we on the cusp of an unprecedented move by the U.S. to enter this war? Yes, I refer to Amy Jabbard's earlier comments that said that President Trump is ambivalent towards getting more deeply involved in Iran, I think we know that.

But that doesn't mean that we won't. We've been in the United States. In fact, we put out a report to our clients yesterday called Finishing the Job. There's been a couple of series of events that despite Trump's eagerness to bring Iran to a nuclear deal has derailed the process. One is the breakdown in the actual negotiations themselves over the issue of whether Iran can have any enrichment at all or partial enrichment. Iran dug in on that.

They went very aggressive. And the second was Israel taking matters in their own hands to some extent, not to the US, but really Israel taking the lead with the military strikes. Now Trump is clearly hesitant to enter into endless wars and so on and wants to bring Iran to a deal. But if Israel backs down or if we go into negotiations without taking out the Fordo nuclear plant in particular, it will be more of the same. Iran has already indicated many different ways that yes we want to come back to the table, but they're still putting conditions on.

And so even though we don't want regime change or that kind of instability, obviously some people wouldn't mind that. The administration wants that. I do think that we end up going in and hitting the Fordow nuclear plant with the Buster bombs. And of course, when we're talking about the Fordow, you know, nuclear enrichment site, we're talking about a site that's buried something like half a mile down into a mountain.

And there's a lot of speculation that really the only truly effective way to take that site offline is to drop these GBU-57 bunker busting bombs that are made by the US only for. only for the U.S., carried by a U.S. plane, the B-2 stealth bomber, which, of course, is what we reference when we talk about the U.S. getting more directly involved in this conflict.

How much, if that step were to be taken, how escalatory is it in regards to this conflict? What does it mean for oil prices? What does it mean for defense spending? What does it mean for defense spending? What does it mean for US involvement in this part of the world in a more meaningful way again? Yeah, after our report, we got a lot of questions from clients.

They're interested in the same things that many other people in financial markets are interested in, in particular, the escalation levels and what it means for the closure of the potential that straight trades of harm moves, which would be, you know, have major implications for oil prices. Our working assumption, and I feel relatively confident in this, is that the retaliatory measures that people are talking about on Iran is threatening are, one, the capacity capabilities are far exaggerated. We've seen Iran militarily diminished as essentially a paper tiger to some extent.

I'm not saying it's nothing. But second is on the political side is the will of this of the stormy christine really escalate into a regional conflict uh... is uh... is is is not there and i heard back to a common from a very good friend of mine terms such a poor one of the very wrong panelists when analyzing this uh... islamic government he said the islamic republican leaders

are homicidal but they're not suicidal. And we have to keep this in the background. So, Sassan, given that, it seems to me, just as an outside observer, not an expert, that no matter what happens, Iran has been defanged militarily, the concerns about how they'll respond to various aggressive action in the region. So how does that change the economic and political dynamics in the Middle East from here?

Well, I think there are the extreme versions of that where people are wondering whether this actually topples the regime, which would be an historic development. In the sense, 1979, this would be really an earth-shattering game changer for the entire region for obvious reasons. There are many people within Iran who wouldn't mind that, and there are many expats who want to work with her, cheering that on. I am skeptical that we are

at that position. The Shah's son in exile is unpopular. There's no military that was built up on the frontier with Iraq, with this MEK. They've been pushed back. And the internal resistance is strong, but there's no alternative. We could get some—I think that interesting— one last point on that result of this could be essentially a military takeover of the regime, similar to what we've seen in Egypt. Sasan Garamani, great to get your insights today. Thank you for joining us.

Up next, Mike Santoli looks at why investors are preferring quality stocks right now and which ones are outperforming. And one market strategist says investors should buy on market dips. She's going to break down the names that should be on your shopping list. It's all about sector domination. Overtime will be right back. Welcome back to overtime more evidence of strong investor appetite for new public listings two new IPOs today both closing up double digits slide insurance and carers life sciences both ending their first days well into the green of double digits for both of them IPO activities surging this year about so far, that's through June 12th, according to FactSet. It's the most since 2021. All right, well, now let's turn to senior markets commentator

Mike Santoli for a look at an investor shift toward quality. Mike? Yeah, John, and this has been in place for a while. There's multiple somewhat at odds storylines running through this market, but one of them is that quality has continued to be rewarded. This is about the business quality of the stocks.

So you see here on a year to date basis outperforming the S&P 500 still though, did this high quality ETF have a somewhat tougher day today in part because Visa and MasterCard are very large holdings of it and they did pull back some 5%. Now take a look at regional banks. Financials in general, they've been kind of leadership,

they've wavered a little bit. And regional banks, one of the weaker spots in there, you see just recently, last several weeks, starting to underperform although they were up today. So you wanna see them probably start to close that gap if you think that, obviously you hope that the economy holds together. Finally, did wanna point out more broadly about ipos the this ipo etf this is made up of recent ipos largest holding his palant here

just about at its old highs and if you look at some other indicators of ipo excitement it also goes back to early 2021 which is kind of good news until it's bad news because that was basically the peak of a mini bubble, John. How do you reconcile them? When I think about quality, I think about that in contrast sometimes to IPOs, because they haven't usually had the time to prove their metal, no?

It's true, and I think it's about kind of different cohorts of buyers active in different areas. Also, quality is not really the same as being conservative or defensive or value focused. It's very technology centric. It's just the more established technology companies and other big blue chips and things like that.

But there's been this case for a while that there's been fevered activity in penny stock volumes. IPOs are getting a great reception. So you have a little bit of a speculative adrenaline running through one part of the market. The rest of the market kind of happy to sit with the proven winners. Yeah, we're starting to see some SPAC deals make a comeback to to your point. Again, for better or worse. Mike Santoli. Thank you. We'll see a little bit later this hour. Time for a CNBC News Update with Kate Rogers. Hi, Kate. Hi Kate. Hi Morgan. A jury found Karen Reed not guilty of second degree murder in the retrial over the 2022 death of her Boston police officer boyfriend John O'Keefe. Reed was also acquitted on manslaughter charges but was found guilty of drunken driving and sentenced to one year of probation. That verdict comes nearly a year after the first trial ended in a hung jury. The FDA approved today Gilead's antiviral injection drug

for preventing HIV. The company says the twice-yearly drug could help end the decades-long epidemic caused by the virus, but the drug faces several hurdles, including President Trump's proposed cuts to federal funding for HIV prevention and its steep $14,000 per injection price tag. And New York's congestion toll plan has cut traffic jams

in the city by 25 percent. According to a new report from the Regional Plan Association, instead of causing gridlocks outside the toll zone, traffic in neighboring New Jersey counties also fell as much as 14 percent over the program's first four months. Back over to you. Yeah, that's been a hot topic of debate here at CNBC headquarters. Kate Rogers, thank you. Up next, we'll get the outlook for the housing market as buyers pull back. With United Wholesale, I'm Morgan C.O. Matt Ishvia.

Plus, solar stocks are getting hit hard by the Senate's changes to President Trump's budget bill, but we'll tell you which energy companies could be big winners. That's coming up on Overtime. Welcome back to Overtime. Let's recap the day. Stocks ending essentially flat. The Fed keeping its key rate steady, still seeing two cuts coming in the second half of the year.

Oil prices steady today after rallying more than 4% yesterday. MasterCard and Visa both falling as investors worry about potential disruptions from stablecoins in the payment world. And a few stocks hitting all-time highs. Bank of New York, Mellon, Cardinal Health, IBM, J-Bill and Seagate. Meanwhile, investors digesting some pretty bad data from the housing industry today, and this week, Diana Olek has the details, Diana. Yeah, John, overall, housing starts came in at the lowest level in five years,

but always important to break this one down. So, multifamily starts in May, dropped over 30% month to month. This is a volatile monthly number, but we have seen a record supply of apartment units delivered in the last few years with more this year. So the development pipeline has been slowing. Interesting though, that permits, which are of course an indicator of future construction, are higher. That's because the market is now seeing stronger

demand and people staying in rentals longer. Why? Well, because they're not buying homes. So you see that in the single family housing starts flat for the month and down over 7% from a year ago. This should really come as no surprise given the very low builder sentiment report we got yesterday and a weaker outlook from Lenar's quarterly earnings report on Monday. The consumer is just not willing or just not able to make such a large investment right now given high costs, high interest rates, and overall economic uncertainty. And you also see that in the mortgage demand numbers we got this morning. Mortgage applications to purchase a home dropped again last week.

When you look at applications just for newly built homes, those were down over 4% year over year in May. And rates did drop a little bit last week, but really mortgage rates have been hovering in this very narrow range, just below 7%. This I believe is what everyone's calling the new normal. Morgan. All right, Diana Olek, thank you.

For more on this state of housing and mortgage demand, let's bring Matt Ishbia, CEO of United Wholesale Mortgage. The company is the number one mortgage originator in the country. Matt, it's great to have you back on the show. Welcome. Let's start right there is seven percent than your normal you know I don't I don't know if it seems like it's been there for a little while but the truth is you got to shop around

there's a lot of people to get a race in the six and a quarter six and a half and there's of course there's seven and seven to quarter so it depends on where you're going with you're going to mortgage matchup comm with you're finding a bank a lender we, what are you looking for? But rates aren't as high as people like to make it seem, but affordability is a problem, so I do agree with

that. Okay, so high costs, high interest rates, uncertain economic outlook, as Diana just pointed to in terms of why we've seen sluggish housing data continue. We did just get a Fed rate

decision, which was no decision today. How meaningful would it be to see the Fed start cutting again? Would it bring rates down? Would it bring more people into the market? Absolutely. I mean, it's really time.

I think President Trump's been out there talking about it. I think the head of Fannie Mae and Freddie Mac, Bill Poulty, who leads FHFA, has been talking about it. Rates have to come down, and it will make a meaningful impact on affordability so consumers can buy that first house or even move up buyers. And so right now, the Fed has been pretty stubborn with where rates are. Rates coming down just down to 5.75, 5.99.

So just a little bit lower than they're at today will create a massive opportunity for affordability on the purchase side. And also, people that have been stuck in those 7, 7.5% rates or 6.75% rates for two years can save money monthly. It'll be a big boost to the economy. Matt, it seems like a really tough market right now for mortgages with low affordability,

as you reiterated, looming tariffs. And so the reason the Fed would cut rates, it seems, would be real employment issues, which I imagine would affect the demand for even more affordable housing now You know you could you could look at it that way But there's a lot of reasons the Fed should cut rates You know you could look at employment you could look at inflation

But a lot of this the scare of what the tariffs might do you know is that really the reason right right now? The where the Fed has the rates versus where inflation is, rates should come down and it should be an opportunity. Well, it's going to spur the economy in a positive way. So there's a lot of smart people that are making these decisions, but I'm on the side of, hey, rates should be coming down. It should be an opportunity for people. But in the meantime, there are a lot of people buying houses.

Let's not get confused. I know the mortgage numbers say they're down, but UWM, we're the largest mortgage company in America for this to be our fourth consecutive year, and we're having our best quarter in the last four years, since 2021. So I'm not that concerned like it's not happening at all. There's value in this business out there, but there should be more. What region's doing the best? You know, it's really all around the place, all over the place. I always think the South and some of the bigger states that are booming right now, Texas has been strong, Arizona has been strong, Florida has been strong, but you know it's really

throughout the country. I'd say there's a couple weaker spots, but for the most part it's been pretty consistent across America that there is opportunity, just not as big as we'd all like. It's interesting to hear you talk. I know you've been taking market share for a number of years, and I do want to dig into the opportunity you see here in this mortgage market right now but first the company has also had its share of legal dramas over the years and just earlier in April Ohio AG accused UWM of quote predatory business practices didn't want to get your response to to that lawsuit and what investors and consumers need to know or understand about the business and how you do originate loans. Yeah, well, I mean, those things are just silly. When you're on top, people take shots at you. That's the way it is.

No one talks about the 63rd biggest lender, the 240th. They wanna take shots at the number one lender. We provide the best rates, the best service, and the best technology, faster, easier, cheaper. That's why people go to mortgage brokers. That's why people go to mortgagematchup.com to get a mortgage. That's happening right now, and everyone can dislike it, but the truth is we do what's better for consumers.

Mortgage consumers going through brokers save about $10,000 versus going through the retail lenders and banks. And so, yeah, you can put any lawsuit, a lawsuit isn't real, anyone can say anything they want on a lawsuit. What actually happens is what's helping consumers? what are you doing to run a business I feel amazing about our business we're as strong as we've ever been and we're only gonna get stronger whether rates come down if they don't we'll keep winning as we have been. You just mentioned Bill Poulty in terms of administration and

some of the policies we see taking shape around housing what would privatizing Fannie Mae and Freddie Mac mean for the mortgage market? You know it's interesting you know obviously Bill Poulty, it's great to have a leader in the industry doing the right things, making the right decisions, working with the president, working with the right people to make the right things for the industry and consumers. Do I think they're gonna go private?

I don't know, I don't know the answer, but I do know this. Having them being more competitive and competing with one another to innovate and come up with new technology, lower costs, you know, doing different things is great. I think Bill Pulte is leading from the front, doing great things right now. You know, what's the future? Like, are they going to go public but still have that guarantee to protect people?

Like, how is it going to work? I think Bill Pulte is all over it and the people at Fannie Mae and Freddie Mac, I think they'll make the right decisions for consumers, which is the most important thing. Matt Ishbia, great to have you on. Thanks for joining us. Thank you. Up next, the clean energy stocks that could clean up from the changes the Senate made

to President Trump's budget bill. Plus we'll look at the underlying state of the economy. Does the Fed really have the luxury of being patient? Overtime's back in two. Welcome back to Overtime. It was a winning day for video game investors. Nintendo shares hitting an all-time high after a strong debut for its Switch 2. 3.5 million units sold in just four days.

The company's forecasting 15 million units will sell by the end of its fiscal year. Take two interactive hitting a record high as well. EA and Roblox also outperforming the broader market. Well, there's been a dark cloud over solar stocks this week after the Senate slashed renewable energy incentives in its version of President Trump's tax bill. But there are some clean energy winners and Emily Wilkins joins us with all of those details. Emily. Hey Morgan, well yes Senate Republicans they really do remain divided over these clean energy tax credits in the Trump mega bill. Some are

actually still pushing for changes to the bill that was released earlier this week. So in the Senate bill right now nuclear, geothermal, and hydropower have all emerged as winners. They would actually qualify for credits until 2033 same as under current law. Solar and wind as you mentioned they are not the winners here they're the losers. They start being phased out in 2026 and then those credits end in 2028. Now hydrogen is even shorter. The only projects that would get that credit would need to be under construction by the end of this year. And a lot of groups are saying that's too short, including the oil and gas lobby. They are weighing in on

this fight. Mike Sommers, the president and CEO of the American Petroleum Institute, said that he wants the hydrogen credits to go through 2029. This is an emerging technology. There has to be some kind of an incentive in the tax code to get people to really make that final investment decision. And that's what we're advocating for now because we know hydrogen has a future, particularly naturally natural gas based hydrogen. Senators I spoke with this week are saying that these credits could change in the next few days.

Senator Shelley Moore Capito said, and she's looking at the hydrogen tax credit in particular, wanting to make some changes there. And then Senator Tom Tillis said that they will have to allow some of these credits to have more time for these companies that are trying to invest in them. And he expects to have most of this settled by next week. But guys, of course, there's a huge debate over these between the Senate and the House and a long way to go,

I think, until we see consensus. Yeah, just sticking with hydrogen for a minute here. I mean, this is something West Edens over at New Fortress Energy has been investing in and talked about to me, you know, with me over the years is the fact that natural gas is a bridge fuel and hydrogen is sort of the next step in the technology. So I do wonder how this speaks to that bridging dynamic from hydrocarbons, from oil and gas to some of these renewable technologies. Because nuclear, it's great to see incentives in place and permitting processes being streamlined,

but that still takes years and many billions to get online. Absolutely, Morgan. I think the fact that you do have sort of the API, one of the biggest pushers for oil and gas on the Hill, really lobbying for this issue, tells you about the connection that they have there. And I've spoken with other folks in the hydrogen area, and they've told me that a lot of companies that have said they're going to invest are now having second thoughts about whether they'll be able to continue with their projects if this hydrogen tax credit is cut so that it can't go past this year

And I know that that's something that senders have talked about of course the issue is that for all these tax credits This is something that the fiscal hawks wanted to see eliminate so they could get some of those savings back reduce the debt And so that's the push-pull that you're seeing going on here in Congress and one that's likely to continue for the next couple weeks As this bill is set to come up for a vote in the Senate. Lots of pulling and pushing, Emily, thank you. Well, up next, a top market strategist gives us a peek at her shopping list and tells us why she's still buying Market Dips.

And check out Sherri's sports and entertainment company TKO, closing at a record high. Citi hiking its price target on the owner of WWE and UFC to $200 from 170 bucks, setting an optimistic outlook for media rights renewals. Welcome back. Stocks have had a volatile week. Geopolitical tensions aren't getting any lower. Neither is the Fed's inflation outlook, though its GDP forecast is lower. If market volatility picks up, should you buy the dips? And if so, which stocks?

Let's bring in BD8 Capital Partners Barbara Duran. Barb, what's on your list? Well, there's a number. This is all looking for names in this uncertain environment. You heard the Fed today today things look good right now But going forward we're still not sure what the impact will be of tariffs in terms of they but they raised their forecast on Inflation lowered it on GDP So what are the kind of names that you want to buy on pullbacks because the market is at a 22 plus PE right now

We've had a big spring back from the low in April. And so February, excuse me, in April. And so you're looking for the names that are gonna withstand that. And that tends to be number one, it's the general theme of AI. And we've talked about this, but we're always talking about this for a long time to come. And some of the obvious names like Nvidia or Broadcom,

or you have things like Meta, which is really benefiting from their use of AI and an advertising that's really increasing their engagement and their advertising efficiency, or even at Amazon. Amazon is really using robotics and AI to increase there. So you're gonna see that continuing. Where you look at names like Eli Lilly, that has a really dominant franchise

in the weight reduction space with an oral medication that should be approved sometime next year. You know, these are things that are all long-term running trends. Or an intuitive surgical, you know, which is minimally invasive surgery. They're the leader, in fact, and that continues to see much more usage

in terms of applications. Last week in India, for instance, the first cardiac procedure done minimally invasive. You know, week in India, for instance, the first cardiac procedure done mentally invasive. You know, or in Uber. You know, in Uber is both the ride sharing theme, the food delivery theme, and of course, now they're testing right now in Austin, Atlanta. You know, with the big mode.

So there's a number that, but on pullbacks, because they've all come up a lot, so you have to wait, but a meaningful pullback. So on a name like Amazon, are you buying more on a top line growth on a pullback or bottom line savings given the CEO is saying we're probably not going to hire as much as we would have otherwise because we're going to use AI? Yeah, that's interesting because I'll tell you that's a sign of things to come in terms of the productivity. But I think

it's both. I mean, Amazon is the biggest e-commerce company out there. We don't know what's going to happen with some of the advertising with some of the Chinese third party that they've been using but it's both. I mean they're focused on top line and they're also focused on margins which is really what got meta going a couple years ago when investors were pretty discouraged about spending going on. So I think it's both. Does gold have further to go here, especially given geopolitical tensions and uncertainty for the macro outlook? Morgan, I think it does. I think that a pullback here would be normal because I think there's two things going on with gold.

You know, it still remains a refuge in times of uncertainty, whether it's geopolitical, economic uncertainty, you know, or inflation. But I think there's been a real structural change that started around 22 when Russia, some 300 billion Russian reserves were impounded by the Europeans because of the invasion of the Ukraine war. And I think other central banks said, hey, this is not good. This could happen to us. And you've seen a lot in plus with the geopolitical uncertainty with us and the uncertainty around what we're doing.

People are trying to diversify away from the US dollar away from treasuries, etc So you're seeing gold buying in the emerging markets central banks has increased increased fivefold each year since then and that's gonna continue You know we and Germany have reserves are about 74 75 percent gold India's 11 percent China's 5 percent So there's gonna be continued demand that is really aside from any kind of safety hedge. So I think that will continue. But a bit of a pullback here after it's run, it's had a very big year, would not be unexpected. Okay, quickly, SLR changes. We saw financials finish in the green today. Fed is going to be meeting to talk about bank deregulation next week.

Is it a buy here? Banks? Well, it's interesting on the banks because that's that's part of what's going on with the economy economy right now looks strong and on any pullback and with deregulation because that's going to be the next emphasis of this administration and you're seeing a big push to increase the supplemental reserves that they can then buy more treasuries. So depending you know on the name you know you could be sniffing around in here for sure. Okay. Robert Duran, great to have you on. Thank you. Thank you.

Up next, Mike Santoli is back. He looks at whether the recent low in the economic surprise index is a red flag for both the economy and the market. Stay with us. The Fed may have kept rates steady, but does it really have the luxury of being patient? Let's bring back Mike Santoli for his take. Mike. You know, for now, it's a defensible position, I would say, Morgan.

I mean, a lot of dovish investors probably were looking for a little more accommodative language out of the Fed and the outlook today. But here's the City US economic surprise index. And I think it's a good comparison with last late summer and fall when we did get finally a 50 basis point rate cut in September on the way to a full percentage point. You see that there's been this downturn

in the economic surprises so that the numbers are coming in worse than forecast below zero recently on a year to date low. But this was the growth scare of last year that kind of built into that September move to cut rates by 50 base points. By the way, where did rates start back then? Five and a quarter to five and a half percent. So everybody knew they were too high relative to the neutral rate, relative to inflation, kind of had to get moving on rate cuts. Right now, we're four and a quarter and four and a half percent, so maybe a higher

threshold for what it takes for the next move. Bigger picture, much bigger picture though, when Fed Chair Powell says, we believe the economy is pretty good and policy is in a good place, he could point to the good old misery index, which just is the sum of the unemployment rate plus CPI inflation got to be a big popular talking point in the 70s when it was way too high back here. And what you see right now is it's way lower than almost all times in history.

You go back to the late 90s it was here and also the late 2010s, the pre-pandemic type of economic performance. So in that regard, there aren't emergencies the Fed feels it needs to respond to, either on inflation or economic growth in the labor market. Of course, things can change quickly. So we have about three months to figure out if they did.

Yeah. But to your point, not a lot of misery in the index right now. I think this is going to be a key piece of the nuance of the conversation we have with San Francisco Fed President Mary D, here on overtime come Friday. That being said, was there anything from either Fed Chair Powell or from the statement and the little bit of tweaks we got to it that did surprise you or that you do think

the market's overlooking and when we come back to trading, since tomorrow's dark on Friday, could actually get some more focus? I think that really it's kind of the divergence of opinion within the committee and the high threshold for making a next move is pretty stark. You have really way more members that see fewer than two cuts the rest of the year

than you do see more than two cuts. And so yeah, you have this median that's pretty much steady as she goes, but it seems as if there are just two divergent ways of looking at this economy and also using what you expect out of policy in the coming months, how that's going to filter through to the numbers. So I think you have to monitor a lot of different things. And I think we're going to basically be in a mode of we're rooting for good economic numbers because we're not going to have the Fed really quick to move as a backstop.

So that's a good thing. Good news is good news on the economy. But you know that there's going to be periods when it's not going to look like the economy's cooperating markets might have a little bit of a scare because of that. All right, Mike Santoli. Thank you. John, it is fascinating to me, you know, that basically the Fed was maybe a tilt a tilt more hawkish but largely in line with what the markets expected and you

saw that play out in stocks and also in the bond market today with all the major averages basically finishing flat. It's a tough economy though we've got rates higher for longer we've got unaffordability with mortgages and housing consumers have stretched credit and we don't know to what extent tariffs are going to impact everything in the back half of the year. Yeah and of course you've got geopolitical goings on in the Middle East something else to watch here over the coming days is that situation evolves in real time that does it for us here at overtime. Fast money starts now.