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AI disruption, energy shocks, and policy risks reshape markets 3/25/26

Worldwide Exchange·Mar 25, 2026·43:41

About this Episode

Markets grapple with renewed AI disruption as software stocks face pressure, and investors rethink long-term profitability. Plus, energy prices and geopolitical tensions continue to drive inflation concerns and consumer strain. And later, policy uncertainty around tariffs and affordability adds another layer of risk as investors look for clarity in an increasingly complex macro environment.

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What does it mean to live a rich life?

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And nothing brings us together quite like Team USA at the Olympic Winter Games.

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When Team USA steps onto the world stage, we're not just watching.

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I'm Morgan Brennan, and this is your morning call.

Welcome to CNBC's morning call. This is a new show designed to be your daily destination

to get an early start set the narrative for the business day.

U.S. stock futures with the major averages coming off their fourth, down day and five.

It was a whip-stop session yesterday, but you could see popping here this morning poised for sizeable gains at the open.

Similar situation for treasuries, bonds right now, some buying in there as treasure yields are under a bit of pressure.

You got the 10-year U.S. treasure yield, 4.334%.

And take a look at what we're seeing in metals as well, because precious metals and industrial metals are both on the move higher.

Gold is up about 3.5% silver is up 5% right now this after a five day losing streak for gold.

But to our top story, energy markets pulling back in a very big way this morning.

That's what's driving all the market action we just showed on your screen.

Brent, back below 100 bucks a barrel. This is on reports the U.S. has sent.

And Iran has received a 15-point plan to end the war, even as the Pentagon reties to deploy another 3,000 troops to the region this time through the Army.

President Trump speaking with reporters in the White House yesterday.

The fact that they're talking to us and they're talking since.

And remember it all starts with they cannot have a nuclear weapon.

Just, you know, I said yesterday, what did they said? What are the top 10?

I said, well, number one, two and three is they can't have a nuclear weapon.

And they're not going to have a nuclear weapon. And we're talking about that.

I don't want to say in advance, but they've agreed they will never have a nuclear weapon. They've agreed to that.

A regional reaction now with our Dan Murphy in Dubai. Dan, what are you hearing?

Hey, then, Morgan. Well, the AP has just reported that Iran has now received President Trump's 15-point peace plan via Pakistani mediators.

And the drop-in oil prices perhaps shows that investors believe Washington is serious about ending this conflict.

But, of course, we still don't know who exactly the U.S. team is talking to.

And analysts tell me today this peace plan could be more of a wish list than a ceasefire framework, at least for now.

Iran's military also making clear where Tehran stands. A spokesperson saying today, according to state media, that the U.S. is, quote, negotiating with itself.

It's a push back there on Trump's claim made just a day earlier that Iran wants to make a deal.

Meanwhile, we're also learning more about Iran's demands, which are steep.

The Wall Street Journal reporting that Iran is calling for the closure of U.S. military bases in the Gulf, the lifting of sanctions,

and the right to keep its missile program intact as well, a U.S. official calling those demands, quote, ridiculous and unrealistic.

That also seems to be the view from the Gulf as well, Morgan.

Leaders here have balked at the idea that Iran could charge a toll in the Shared Strait of Hormuz,

and are also reportedly lobbying the President to stick with this war plan until Iran no longer poses a threat to their people or infrastructure in the region.

Reports also say that Saudi Arabia has told Washington it is prepared to strike Iran directly if its own power and water infrastructure is targeted again.

And then Morgan on the ground, very few signs now that we are seeing a slowdown.

As you mentioned, the Pentagon deploying thousands of additional troops to the region, Iran maintaining its grip on the Shared of Hormuz in Israel,

also saying its strikes on Iran will continue.

Yeah, the Army's 82nd Airborne, we're getting some more detail on that, and just a few minutes here on the show,

also getting some reports of high-level meetings that could potentially take place as soon as Thursday,

between delegates of the two countries.

We'll see how all of this plays out here over the coming hours, Dan Murphy. Thank you.

Well, as energy prices pull back, once again, we are seeing U.S. equity futures move in the opposite directions.

As you can see right there on your screen, the Dow up about 400 points, indicated for 400 point gain at the open.

Similar situation with the VIX as well, as we start to get a bit of a breather there this morning.

Those still elevated, it's down about 5%, 2570 is the level there.

Major indexes across Europe and Asia also, sharply higher.

Joining me now, Joe Missola, head trading and derivatives strategist at Charles Schwab.

And Joe, it's great to have you on the show. Let's start right there.

Because we've been talking about the headline risk for the markets here and this inverse relationship between oil and equities,

what breaks that loggerhead?

I think that's a great question. I think, you know, we need to see that there is real movement in terms of these negotiations.

Futures tend to spike fairly quickly and then what we tend to see throughout the course of the day as more information comes out.

That's where that's when you really start to see whether or not the cash is moving alongside.

I think getting grand back down below 100 helps.

I think we have started to see some other indicators that maybe volatility is coming out of the market.

You know, one of the things that I followed quite a bit is the move index and that basically measures the volatility of fixed income.

That had, we had gone from 55 up to 110.

So we basically had a double within a month's period.

That is starting to come out.

You know, not only are equities pricing off of what's happening in the oil market, but to a certain extent,

you know, the bonds have had an effect as well too, as yields have pushed up.

And it's basically making it difficult for investors to kind of follow any 60, 40 type of portfolio because you got bonds and equities falling at the same time.

That's such a key point. It's been a nowhere to hide market here. So where do you hide?

Well, I'll tell you what we're seeing.

What we're starting to see from our own clients is that we saw a decent amount of selling at the beginning of the month,

but that sounds really started to abate.

What we've seen recently is a pushback into technology.

A couple of names specifically would be Microsoft and they had those are two names that we've seen a lot of buying in.

We've actually seen what's interesting Morgan is a bit of a rotation from equities into ETFs.

So there's been more of this idea of we want to be a little bit more diversified in which is,

which is a bit of a change because what we tend to see or what we tend to see over the last few years is a.

A real pension for investors who want to kind of pick and choose what they consider the winners in the AI had been.

Top of a list for many, many years in terms of the net buys, but now we're starting to see some of the more diversified ETFs move up that list as investors are trying to kind of figure out what path to take.

On Monday, it was it was interesting in the markets all 11 sectors were up.

So, you know, eight to one advances over the climbers, but that a lot of that started to dissipate yesterday,

but I think we only had six of the sectors finish higher.

We'll see what it looks like today.

You know, we saw the equity futures of about 75 points earlier in the in the e-minis in the S&P 500.

We're down to about, you know, higher by 58 right now.

So there's still time before the market opens, but it'll be interesting kind of to see how these flows go.

Yeah, and in the meantime, we haven't had a ton.

We do not have a ton of economic data this week, but we have been getting in has been arguably conflicting.

So Joe stay right there, because I want to turn to the broader economy ripple effects of the war with Iran.

Economists now starting to weigh in as well on cnbc.com's Jeff Cox, just published an article with new details.

He's joining us live this morning to break it all down. Jeff, good to see you.

Good to see you Morgan. I'm glad to be on this show.

Congratulations. Enjoying it a lot.

Thank you.

So it's just so it's just a Wall Street economist are getting a lot more nervous about the prospects for recession.

The next 12 months, not trying to rain on the markets parade today.

But Moody's has raised its recession probability to nearly 50%.

Goldman Sachs is now up to like 30%.

EY Parthenon is around 40.

Wilming's entrusted 45%.

So just getting a lot of this type of conversation from the economists that I'm speaking to.

We're all on edge with uncertainty about the Iran war looming.

Everyone's nervous about prices at the pump, which are risen by more than a dollar a gallon.

But it's also very much about the labor market.

We're coming off a year where we just saw 116,000 jobs in aggregate created.

That was less than the monthly average for 2024.

And then when you exclude health care from that, we're talking actually about a loss of more than half a million jobs.

So a week labor market in turn means a week consumer.

And that's what's really kind of got economists on edge here watching for further developments.

Is this going to hit consumers spending?

Are we going to see more of an aggregate aggregation of that case shaped economy?

And how sustainable is all this as we go forward?

Jeff, thank you. Joe, I want to get your reaction to that.

Especially as you just touched on it before, we have seen a surge in yields for the two-year treasury

as the Fed and other central banks across the world to become more hawkish.

Hi, and look at yesterday's PMI reports, right?

Even though both showing an expansion territory saw the prices paid up around the 60s in some of those components.

So that's where sometimes you need to dig a little bit below kind of the headline news, especially with the PMI data that came out.

Just to show that consumers getting hit harder, they definitely are.

It's one of the things that we talk to our investors quite a bit, not only through our stack report,

which is basically a look at kind of what they're doing in their activity, but we also interview them.

And we ask them kind of an attitude and all standpoint, how are they feeling?

And that is something that we're hearing quite a bit.

Is that, look, your prices, their concern around prices going up, there's concern around the geopolitical conflict.

We haven't seen that lead to, like I said, a mass accident in equities by any means.

If anything, you know, there's just kind of a rotation going on.

And they're still looking for opportunities.

But at the same time, the longer this drags on, the higher the prices at the pump.

And ultimately, the lower the discretionary income that's going to bleed out into the economy at some point.

Okay.

Joe Missola, great to have you on.

And Jeff Cox, our thanks to you, go read his article.

It's on cmbc.com right now.

A lot of good information there.

Well, we've got a lot more to come here on morning call as well, including the straight-of-form moves.

What will it take to get back to business?

And what does that mean for oil?

What does that mean for the broader markets?

Plus, about face at OpenAI, over one of its more controversial features.

And later, a big legal blow from Meta, one of one of the company plans to appeal.

We've got a very busy hour still ahead.

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This team brings us together quite like Team USA at the Olympic Winter Games.

From NBC Universal's iconic storytelling to the innovative technology across Xfinity and Peacock,

Comcast brings the Olympic Games home to America, sharing every moment with millions.

When Team USA steps onto the world stage, we're not just watching.

We're cheering together.

This winter, we're all on the same team.

Comcast, proud partner of Team USA.

Welcome back to Morning Call.

The critical straight of Hormuz connects the Persian Gulf with the Gulf of Oman and the Arabian Sea.

Just 21 miles wide at its narrowest point.

It handles roughly 20% of the world's daily global petroleum consumption,

as well as many other commodities.

With a straight effectively closed experts say the energy supply shock and subsequent market volatility

will not subside until more commercial vessels are able to cross.

So this is what this has caused over the past month.

You're looking at a live picture of the ship congestion around the straight.

This is from marinetraffic.com, if we could pull that up right there on your screen.

In lieu of a peaceful resolution, what will reopening the straight take?

While neutralizing land-based missiles and drone threats from Iran,

on the water countering the Iranian revolutionary guards, hundreds of small, fast attack boats

that can swarm larger vessels, and then, of course, there is a threat of underwater mines,

which some experts say could take weeks to clear.

Finally, there is the big unknown, and that is ground operations.

So you could see right there joining me now is Retired Vice Admiral Kevin Donigan,

who was former commander of the U.S. Navy's Fifth Fleet.

He's now distinguished senior fellow at the Middle East Institute and Admiral.

It is great to have you here.

Also joining me in studio is John Kilda, founding partner at again capital and a CNBC contributor

and Daniel Tannenbaum, partner at Oliver Wyman and a senior fellow at the Atlantic Council.

But Admiral, I want to start with you, and specifically what it is going to take

to open the straight from a military standpoint, from a logistic standpoint,

especially as we hear the possibility of peace talks on the one hand,

but more troops, more assets headed to the region on the other.

Hey, well, thanks Morgan, yes.

That's really the question that we all want to answer.

Not just what's it going to take, but how long it's going to take.

The first thing that I'll say is that there are two paths open,

but war is inherently or conflict is inherently unpredictable.

That's probably the only certainty about it.

You have the negotiation path, and we'll put that aside for a second

to talk about the options from a military standpoint.

You see these forces flowing through the region,

the 31st view, the 82nd airborne, et cetera.

But you also have a change somewhat

and inflection point in the campaign that's ongoing,

that Sencoma is currently doing.

Meaning they are doing a good job getting at missiles, drones,

and the things that they wanted to get at in the country.

And it allows them now to shift if they choose weight of effort towards opening the straights,

where you'd see not just the navy going there and help do this,

but this entire joint force would have to be part of it

if it had to be forcibly opened.

And that takes time.

So Admiral, I just, I want to pull up this map again

before I bring in our other guests.

And specifically the piece of this that could mean ground operations,

because devils in the details here.

But there is talk that what you potentially need to see is some sort of seizure

of some of these islands, for example,

along the coast where we have so-called missile cities

and drone activity as well.

And then, of course, there's the talk about Carg Island

as a key tactic, leveraging tactic,

a key tactic for leverage.

And in the wake of, I'm getting myself tongue tied,

negotiations with Tehran.

Just the fact that we do have all these Marines headed there,

we have 82nd airborne now,

according to numerous reports, headed there.

How to think about what boots on the ground could actually mean

and just how prolific that could be when we have seen forever wars

and things like that in the past?

Well, certainly boots on the ground raise the risk of the force, right?

If you're going to put any boots on the ground,

even if it's for a raid early on one of those islands,

that's going to increase risk.

But the overall idea is to deny Iran's capability to use those islands

and those places as a way to stage any kind of attacks on commercial shipping.

That's the idea.

And you don't necessarily have to have boots on the ground do that.

These forces could also help in terms of adding to the force

that's already there to help defend anything that's moving through.

But they definitely give the commander the capability

to do a lot more if they needed to,

unlikely that we'd go in and occupy large portions of Iran

or even occupy some of these islands.

However, like I said, there may be specific things

that need to be done on the ground to nullify that threat you talked about.

We used to talk about it as an air threat, right?

A lot can come at you from mines and missiles and cruise missiles

and these fast attack craft.

But a lot of that's been eliminated already or significantly degraded.

So the mission is absolutely executable.

The real question is how long make to do it and when can flow be restored?

Okay, so with that in mind, Daniel Tannenbaum,

I'm going to bring you into this conversation as well,

because we've also had reports that Iran has been charging for right of passage

for some vessels and we've seen the waving of sanctions,

not only on Russian oil, but now on Iranian oil that's on the water as well.

That's right, and we saw Friday night the president put out a license

that authorized pretty much anyone but North Korea, Syria,

Crimean parts of Russia that were able to buy Iranian oil.

But the challenge there is this is actually pushing people off the dollar.

Most of this oil was never bound for the US.

China had historically been the largest purchaser of it,

but you're seeing a movement towards settlement outside of the dollarized system,

which really makes the US's ability to sanction, to seize pretty meaningless.

Interesting.

John, I want to get your thoughts on this and what it means for what's potentially arguably

a repricing longer term of oil here,

because even as we release all these strategic reserves right now,

those are going to have to be replenished.

And perhaps there's an argument to be made about where geopolitical risk premiums

are going to be commanded when you look at different oil contracts.

No doubt, Morgan, and it's good to see you.

Importantly, we're not going to be able to get out of this anytime soon.

And as we're seeing with some of the reaction in the oil market

to the various wildly breaking news events, such as this new 14-point plan

that's been apparently sent over to the Iranians for a piece of the oil.

You're only seeing oil prices come down, Brent's barely under 100, for example.

And that's because the damage is being done an increasingly so on a daily basis here.

The shut-ins among the various OPEC members that are around the straight that are before the straight.

So to the left of your map of Oman here, you have the UAE, you have Saudi, you have Kuwait, you have Iraq.

Okay, that's the 20% of world oil people are talking about.

They're shutting in their oil production because they have no place to put it.

They can't put it on boats, obviously, and they don't have storage for this.

They're not built for that. They're like sharks.

They have to keep moving and get them oil out.

So you're going to see a higher price level.

It's unfortunate because we came into this year talking about a glut.

But potentially, oil prices as low as into the 40s that we hadn't seen.

Or even dreamt about in a long time.

That's over for some time now.

We're not going to see that, and we're not going to go back to any lower levels.

And we run the risk of going back up higher if some of this isn't resolved, particularly if they can't get the straight open.

It's heartening to hear the admiral say that it's a mission that can be accomplished.

But it seems like a very difficult undertaking.

Yeah, and a lot of countries are already being impacted by this.

And you're seeing policy pushes, whether it's things like gas tax holidays which are being floated here in the US.

You've rationing in some countries already.

Who's the winner in all of this? Is it Russia?

The irony in all of this is it's Russia.

I mean, it's reported that they're experiencing their largest weekly income since March of 2022.

Just after the second invasion of Ukraine, Russia is almost undoubtedly the winner here.

And these sanctions relief that were first imposed related to India buying Russian oil, then humanity buying Russian oil,

and then the rest of the world buying Iranian oil.

All it does is really erode some of the economic statecraft tools of the US

and show how transactional they are that we really give in when there's pressure on the American economy,

which doesn't bode well in the near term.

Okay, Daniel Tannenbaum and John Kilduff here in studio.

And vice admiral Kevin Donnegan, thank you so much.

We'll continue to watch all of this and monitor it here in real time. We'll straight ahead.

New details ahead of Wall Street's potentially biggest IPO ever.

Reportedly coming to market sooner rather than later.

But first, we're watching shares of arm holdings announcing it will begin selling its own chips for the first time ever.

It says it will add billions of dollars in new revenue.

It will mark a strategic strategy shift.

Meta platforms is its debut customer.

And also the EPS guidance now over the next couple of years is monster compared to what the street had been expecting.

But the majority stakeholder soft bank is also popping overnight on this news.

Perhaps not surprisingly, morning call is back right after this.

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In 2025, patients received over 19 million home visits.

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Few things are as uplifting as the greatest moments in sports.

And nothing brings us together quite like Team USA at the Olympic Winter Games.

From NBC Universal's iconic storytelling to the innovative technology across Exfinity and Peacock,

Comcast brings the Olympic Games home to America, sharing every moment with millions.

When Team USA steps onto the world stage, we're not just watching.

We're cheering together.

This winter, we're all on the same team.

Comcast proud partner of Team USA.

Welcome back.

NASA unveiling sweeping updates.

Updates had its ignite event yesterday, repositioning the agency

for what administrator Jared Isaacman called, quote,

a great power challenge with China.

NASA now plans to invest $20 billion over the next seven years to develop a base on the surface of the moon

to not only send humans back to the lunar surface, but to allow them to live there.

To pay for it, NASA is pausing work on the lunar Gateway Station,

which sent some space stocks tumbling in trading yesterday.

Gateway was being built by Northrop Grumman with the help of contractors,

including Redwire and Intuitive Machines, a subsidiary of Intuitive Machines.

That sent shares of Intuitive Machines down almost 12% on the session yesterday.

It also sent MDA tumbling to, even as the Canadian Space Company,

issued a statement saying its robotic arm is under contracts with Canada Space Agency,

not with NASA.

You can see MDA is up about 2% right now, pre-market,

but a push toward more commercial technology reversed Intuitive Machines tumbled to.

And as you can see right there on your screen, it's up 4% pre-market.

It disclosed last night that it was awarded $180 million contract.

NASA wants near monthly robotic lunar landings starting next year,

and Intuitive Machines Firefly others are on tap to be able to deliver that capability.

Also on tap, the first nuclear-powered interplanetary spacecraft to launch to Mars

before the end of 2028.

And in the meantime, next week, the historic Artemis 2 mission that is still on track

to send astronauts around the moon.

All of this, as the information reports at SpaceX, is planning to submit,

confidentially, its IPO application, as early as this week,

and that it could be looking to raise even more money than had been previously reported.

So we'll keep an eye out for that.

But still on deck, JPMorgan's Joyce Chang.

On stagflation risks, private credit concerns so much more.

First, watching shares of GameStop after reporting a 14% drop in Q4 sales,

you could see those shares are up fractionally right now.

Morning call continues right after this.

As America celebrates its 250th anniversary,

CNBC spotlights the leaders, driving business, and the nation forward.

The two things that really make America, what America is, is free expression,

along with free market capitalism.

And those two themes are really the bedrock of what makes the United States such a great country.

When the United States was created, there was plenty of newspapers,

and that evolved into radio and television and digital.

But until 37 years ago, when we created CNBC,

there was really no deadly window into the world of free market capitalism

for the average citizen.

So when we think about the 250th anniversary of this country,

CNBC should be celebrated as critical to what makes America great.

Welcome back.

I'm Morgan Brennan and this is Morning Call, a new show designed to be your daily destination

to get an early start and set the narrative for the business day.

Let's take a check on US stock futures.

What you're popping right now, you can see that on your screen.

on your screen, all the major

for a markedly higher open as

of right now this after a

a whipsaw day yesterday

that saw the averages

finish fractionally lower.

If we turn to the Treasury

market yields are a bit lower

as well right now across the

curve, 10-year Treasury

4.332%. And checking on the

VIX as well, because that is

coming off the highs here to

down about 5% right now, but

still around 25.

Checking some of the

morning's top story was

crude prices sinking on mixed

messages from the White House,

including reports that the U.S.

has sent, and Iran has

received a 15-point

plan to end the war.

This, even as the Pentagon

readyes to deploy

another 3,000 troops to the

region, the president himself

saying Iran's already

agreed to one point in his

plan.

The fact that they're

talking to us and they're

talking since.

And remember it all starts

with they cannot have a

nuclear weapon.

Just, you know, I said

yesterday, what did they

said? What are the top 10?

I said, well, number one, two

and three is they can't have a

nuclear weapon.

And they're not going to have

a nuclear weapon.

And we're talking about that

and I don't want to say in

advance, but they've agreed

they will never have a

nuclear weapon.

They've agreed to that.

Meantime, we're watching

shares of meta-platforms, a

landmark case in New Mexico

where a jury just ruled the

company must pay $375 million

for violating the state's

unfair practices act, failing

to safeguard its family of

action.

And South Korean

ship giant SK

high-nix is exploring a US

listing filing paperwork

with the SEC for a 2026

IPO.

Local media reporting the

company is considering

raising between $6.7

and $10 billion US

at current exchange rates.

And I refresh off of a

$10 billion funding

for the company.

And I refresh off of a

$10 billion funding

round.

OpenAI says that it's

shuttering its short

form video app, Sora.

This is just six months

after its viral launch.

This is the company looks

to rein and costs ahead of

its perspective IPO.

OpenAI, CFO, Sarah Fryer

was on mad money just

last night.

We just are facing a lack

of computes.

We're having to make

those really difficult

decisions.

I've talked about it to

many investors.

Often we hold back

models, we don't release

features.

And this is the

example of having to

prioritize.

It doesn't mean we won't

get back into areas of

creativity.

It's not a never.

It's just we have to make

hard choices.

Well, Fryer adding when it

comes to openAI's

contract with the

Pentagon, a framework is

in place to observe the

company's, quote, red lines,

including no master

valence and no autonomous

weaponry.

Well, investors continue to

ride the roller coaster

of headline risks around

the Iran War, driving the

action.

And as we highlighted just

earlier, expectations on

Wall Street of Recession

are rising.

Front and center to all of

this is the action in the

oil markets.

And the energy problems in

one state may just be getting

started.

Chevron is warning California

may be headed towards an

energy crisis due to its

importing about 20 percent of

its refined fuels from Asia

with countries they're

struggling to meet their own

energy man's due to the

straight-of-war moose issues.

For more, I am joined by

Joyce Chang, chair of Global

Research at JPMorgan.

Here on set, it's great to

have you back.

Welcome.

Thank you.

So much to get into here.

How are you thinking about

this market given all the

volatility and headline

risk?

So we're looking at

scenarios where you have oil

prices staying at a hundred

through the middle of the

year.

And we've made some adjustments

to the economic forecast

because of that inflation.

You see that 0.8 percent

higher, taking half a percent

more off of growth.

Now, the good news was that

the economy was really strong

going into this.

CapEx growth was very strong.

But when you look at

infrastructure disruptions,

you have to think about

this being a scenario that

endures.

So we're looking at mid-year,

$100.

Doesn't come down to 90 by

$80 at the end of the year.

But you're not going back to

where we had oil prices prior

to this.

Yeah.

And in terms of that, how to

think about that repricing,

that re-rating of energy here

and specifically that geopolitical

risk premium that's now going to

be associated with it.

Especially as you have

countries that are now

potentially going to be

stockpiling in the wake of this.

Yeah.

No.

I mean, you're seeing real

asymmetries and you're seeing

uneven effects.

I mean, in Asia,

there really are shortages

right now.

It's not even about the

price.

I mean, that you're seeing

schools shut down.

You're seeing restaurants

close.

And you think about it too.

Go from the straight-of-horn

moves to the US.

It takes about a month and a

half.

So you're not even filling

some of those effects yet,

given that we're only one month

into this.

So I think we are looking at

oil prices that are going to

stay higher.

And the center of gravity

remains the straight-of-horn

moves.

I mean, that's 20 percent

supply.

There are alternative routes.

But they don't replace this

and the SPR reserves, the

strategic petroleum reserves

and everybody's looking at

what they have stockpiled.

You know, are not going to

last indefinitely.

Yeah.

And we're starting to get,

you know, get comments about

potential shortages and other

types of commodities too,

like helium.

So a fertilizer price.

A fertilizer.

And it's the key

spring planting season right

now.

So that has potential knock

on effects.

To go back to this idea of

rising risk of recession.

I mean, in the prediction

markets, calcium specifically,

I'm just looking at this right

here.

On March 1st, those risks of

a recession this year were at

22 percent, currently up to 32 percent.

Whether it's recession,

whether it's, I think you

call it, stagflation light.

How to think about how this

manifests and what that's going

to mean across different asset

classes, including, by the way,

treasuries, which are behaving

a certain way.

Well, I think if you have to

still look at the longer-term

story, so much of the story

was driven by cat-backs.

And cat-x growth was still

over 7 percent.

So if you still think this

longer-term story is AI and

cat-backs and that that won't be

derailed over the longer term,

that's why I say stagflation

first.

I'm not so sure that you have a

growth hit that is as bad as

it could be.

So we've taken 0.2 percent off

of growth, but that's pretty

modest here.

And going into this, you had

very strong growth.

I mean, US growth, you know,

over 3 percent, you know, China's

growth, over 7 percent.

So I worry more about the

inflation impact.

And I think, you're right,

right now, you see hedging,

but not de-risking from

investors.

And with treasuries, I mean,

that has just not been a good

hedge.

You've had a breakdown of the

stock bond correlation that's,

you know, really in year five,

right now.

And so, long dollar has gone

back to being the hedge and

traditional energy.

Yeah, I want to get into all of

that a bit more.

We have lots more to discuss.

Joyce, stay right here.

We're going to take a short

break right now and there will

be back with the call sheet.

So a lot more to come here on

morning call.

Private credit crisis.

More firms curbing client

withdrawals.

AI disruption.

You can go on down the list here.

We'll be right back.

Welcome back to morning call

mounting private credit

concerns as yet another major

player in the space looks to curb

client withdrawals with some high

profile funds from some high

profile funds.

Leslie Picker joins us now on the

CNBC newsline with more

Leslie.

Hey, Morgan.

Yeah, areas is the latest firm

to cap redemption.

And it's semi-liquid private

credit fund that made

redemption requests totaling

11.6%.

So this is just like what we saw

from Apollo on Monday.

And then we've seen that with

clipwater and Morgan's family

and BlackRock in recent weeks.

So areas opted to

thwart redemptions above 5%.

Just like those other firms did.

So that means that investors

who wanted, say, $100 back

got less than 50.

Blackstone is the only major firm

that has so far opted to fulfill

all the requests in the first

quarter.

But Morgan, if the date didn't

exist, the fund would need to

sell a bunch of liquid loans

which could dent performance

for the remaining investors.

Or it would need to take on

additional leverage or draw

down cash to fulfill

the redemption request.

However, what's kind of interesting

about areas that I would note is

that the fund actually grew

during the quarter thanks to

$708 million in gross inflows

or about $184 million in net inflows.

So I was actually kind of curious

why they didn't use those net

inflows to fulfill

redemption above the 5% threshold.

And I'm told that it's

because areas wants to use the

dry powder for future investments.

And it's also kind of a precedent

thing to Morgan.

If you are the firm that fulfills

every single investor request

and you start to turn into, as

one analyst described it, an ATM

where other firms are gating

and you're the one letting

everybody redeem.

People just keep redeeming

and redeeming and redeeming

expecting that cash to pop

out of the ATM.

So part of its psychology

and part of its opportunistic

as well.

Some key insights and key

reporting from our Leslie Picker

on the newsline.

Thank you for joining me.

I want to bring in our

morning call crew.

Just Joyce Chang, chair of global

research at JPMorgan.

She's still with us.

Henrietta Trays, co-founder

and director of economic

policy at beta partners.

And Drew Pettit, director of

US equity strategy at city

research.

It's great to have all of you

here.

Joyce, I'm going to kick it

off with you and get your

reaction to what Leslie

just reported given some of the

cracks we have seen in private

credit.

And it takes me back to Jamie

Diamonds comments about

cockroaches.

Well, there are some real

headwinds for private

credit.

And I don't think you're

through with seeing the

redemption, some tightening of

the liquidity.

But I also have to say that

this is not a problem that we

see as being more systemic

or having a lot of spill

over.

You also have unused bank

commitments.

There will be some secondary

fundraising that's going on.

And there is a lot of dry

powder.

And that is one reason why we

do see a lot of the

specialists firms now really

holding out and saying, are

there some opportunities to

step in right now?

Retail is also pretty small

in private credit.

So I'm not so worried about

the contagion, but I think

the headwinds are there and

you're still going to see more

of the trends that we have been

looking at with the redemptions

and the collateral also

get the tightening of the

liquidity considerations as

well.

Okay.

Drew, your thoughts?

Yeah.

It's funny.

I got to give a lot of credit

to Michael Anderson and our

high yield team here.

Look, we expect to fall rates

to rise.

It's like four and a half

percent in private credit

now.

We think that probably takes

up to seven percent.

And I think a really good

proxy and something we should

be looking at is BDCs in the

discounted nav.

That's been falling.

So really to Joyce's point,

yeah, liquidity is becoming

the problem and you should

see some deterioration.

But is it massive?

Not yet by our team's

destination.

Yeah.

I mean, just be to this idea of

a wall of worry that the

markets are climbing.

Even as we have deregulation

for banks on the table here

from a policy perspective,

I think it's going to be

a lot of trouble.

I think it's going to be

a lot of trouble.

I think it's going to be

a lot of trouble.

I think it's going to be

a lot of trouble.

So I think the policy

perspective, private,

credit and private markets

has not been nearly so

regulated.

Does that, does any of this

shift that narrative?

No, I don't think any kind

of expectation for operations

that a DC and a proactive

approach to this should be

expected.

DC is struggling just to keep

the lights on.

They're hoping to get a DHS

belt that can get us through

the airport quagmire that

we're in right now.

And I don't know if that will

even end by Thursday,

which is my hope.

But the widespread affordability

narrative is really a huge

problem.

Some of the data sets that

they're looking at are just

atrocious with people

thinking 17% of Americans

think it's a good time to buy

a home.

It's just the affordability

cascade and they can't pass

any of this legislation.

So I wouldn't expect them to

be able to focus on this right

now, either.

Okay.

We're going to get into much

AI disruption, energy shocks, and policy risks reshape markets 3/25/26

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