5 things to know before the market opens on Thursday

The Senate yesterday confirmed Kevin Warsh as the next Chairman of the Federal Reserve System in the closest vote in modern history. As CNBC’s Matt Peterson writes, this close margin could be a harbinger of the challenges Warsh will face at the helm of the central bank.

Here’s what you need to know:

The former Fed chief was confirmed with just 54 votes, the lowest level of support for a Fed chairman since the position began requiring Senate confirmation in 1977. John Fetterman, D-Pa., was the only Democrat to vote for Mr. Warsh’s confirmation. Warsh, a prominent critic of U.S. monetary policy, has called for “systemic change” at the Fed. And while President Donald Trump is pushing for lower rates, Warsh still needs to rally enough voters to support them, which could be a tall order as inflation accelerates. The 56-year-old will succeed Jerome Powell, who plans to break with tradition and stay in office. He continues to serve as central bank governor even after his term as chairman ends.

The Beijing summit between President Trump and Chinese President Xi Jinping is underway, and records from the overnight meeting reveal that the two leaders discussed the Iran war, economic cooperation, and Taiwan. White House officials said Trump and Xi agreed on the need to open the Strait of Hormuz, but said Beijing’s readout showed Xi called Taiwan “the most important issue in U.S.-China relations.”

In remarks Thursday, Xi said a key issue for this week’s summit will be whether China and the United States can avoid the “Thucydides Trap,” the theory that tensions between rising and established powers historically lead to war.

Speaking to CNBC’s Joe Kernen from Beijing this morning, Treasury Secretary Scott Bessent said the United States is winning the artificial intelligence race with China, but talks between the two countries are an opportunity to develop guardrails. “We’re going to set protocols in terms of how we move forward with AI best practices so that non-state actors don’t have access to these models,” he said.

Cisco Both stocks beat Wall Street’s third-quarter expectations yesterday, and their shares soared more than 15% in extended trading. The network company also announced nearly 4,000 job cuts this quarter.

Cisco said it has received $5.3 billion in AI orders so far this year and expects this quarter to beat expectations. As CNBC’s Jordan Nobe points out, Wall Street is starting to warm to the company as it lags behind other data center stocks. Cisco stock has risen 33% since the beginning of the year, outperforming the Nasdaq.

Don’t miss Cisco CEO Chuck Robbins on CNBC’s “Squawk on the Street” at 9 a.m. ET. Watch on CNBC or CNBC+.

Consumers are cutting back on their beer intake. U.S. sales of beer, flavored malt beverages and ciders fell more than 6% year over year in the week ending May 2, data showed. As CNBC’s Brandon Gomez reports, the decline is most pronounced among convenience store chains.

Analysts said rising gasoline prices during the Iran war could be a reason for the decline. Look at California, which has the highest average fuel prices in the United States. In the Golden State, sales were down 16% over four weeks.

Hantavirus is testing America’s pandemic preparedness, but experts say it’s not another coronavirus. CNBC’s Annika Kim Constantino has what you need to know.

—CNBC’s Leslie Josephs, Jeff Cox, Matt Peterson, Sean Conlon, Lisa Kai-Lai Han, Jordan Novett, Brandon Gomez, Annika Kim Constantino, Anique Bao and Evelyn Chen contributed to this report.

Davis Giangiulio helped produce this newsletter. Josephine Rozzelle edited this version.