Powell's Rate Message and the Markets, United Soars, "Mag 7" CEOs in the Spotlight 4/17/24

Carl Quintanilla (0:00)

Market Moving Insight and Analysis join Jim Cramer, David Faber and me, Carl Quintanilla, on the opening bell hour of CNBC Squawk on the Street.

Good Wednesday morning, welcome to Squawk on the Street. I'm Carl Quintanilla, bands back together as Cramer returns with David Faber here at post night of the New York Stag Exchange. S&P's trying to snap a three day losing streak amid a series of corporate misses today. US Bank Corp, ASML, Travelers, JB Hunt, markets still digesting Powell's hawkish comments from Tuesday. Our roadmap begins with the fight against inflation as the Fed chair says there's been a quote, lack of further progress this year.

David Faber (0:33)

Plus United is one of the biggest gainers on the S&P in the pre-market. This on the back of strong earnings. Airline also slashing its expected deliveries amidst Boeing's quality crisis.

And Tesla is asking shareholders to reinstate Elon Musk's $56 billion pay package. That was back in 2018 This effort, of course, Delaware court avoided that compensation earlier this year.

Carl Quintanilla (0:58)

Let's begin with the markets are set to open higher after the Dow ended six straight sessions of declines. S&P, Nasdaq, Russell did extend their daily losing streaks to three. Yesterday, as you know, the Fed chair suggested that rates could remain higher for a longer period. Here's what he had to say about battling inflation.

Jerome Powell (1:16)

More recent data show solid growth and continued strength in the labor market, but also a lack of further progress so far this year on returning to our 2% inflation goal. The recent data have clearly not given us greater confidence and instead indicate that it's likely to take longer than expected to achieve that confidence.

That said, we think policy is well positioned to handle the risks that we face.

Carl Quintanilla (1:40)

First off, Jim, welcome back. You're a sight for sore eyes.

Jim Cramer (1:43)

Oh, thanks a lot. It was great doing a little fishing. You know what, I listen to theirs and I keep saying, all right, so we've all been saying this. We've all been saying that he is pragmatic. We've all been saying that we have a problem with inflation. So when he verifies it, I don't think we can say, well, this is a sea change for the Fed. I think that the Fed has said over and over again that you have to have inflation go down, at least for, he wanted several in a row.

And David, I think if we act surprised, we're phonies. If we think it's a sea change, we're phonies.

Because he's looking at the numbers like we are. He said they have to have cooler numbers. They're not cooler numbers. He has to wait for cooler numbers.

Do you think that that's anything different from what a pragmatic person would do?

David Faber (2:37)

No, I'm not questioning the stance. No.

Why are others?

Jim Cramer (2:46)

He made it.

David Faber (2:46)

It seems pretty straightforward. Frankly, the market did not react. It already seemed to have been getting positioned for this likelihood, right?

Jim Cramer (2:54)

Right, because what's happened here is that when you get the verification, Carl, when you get verification, what happens? I mean, I was watching the tape because I was ruining my vacation.

And I kept thinking, okay, well, this is the chance for the people who don't know anything to react. It turned out there were a lot more people who knew than didn't know. So I just don't want to get into this thing. I don't want to get in the horse race of the Fed. The Fed has said, Jay Powell said, okay, look, we got to have some cooler numbers. So when we don't get cooler numbers and you have people still calling for three cuts, I mean, these are people who are saying, you know what, I've looked at the situation and I really think that the Eagles are going to win the Super Bowl against the Chiefs. I mean, what the hell do you know?

What do you know?

Carl Quintanilla (3:40)

The comment, Jim, that maybe was a surprise was his forecast for year-end PCE at 2.8.

B of A is out today saying, actually the base effects for December, for example, aren't that favorable. And in their words, if we take him at his word, there's a real risk the Fed may not cut until March 2025 at the earliest.

Jim Cramer (3:59)

I thought, oh, jeez, well, I mean, like we have a mind melt here. I just actually just yellowed that because I said, well, that may be news.

But again, please tell me, other than JB Hunt, who is cutting price, who is in trouble, and has to let things come down? I don't see that. We have a president who's calling for a tripling of the Chinese tariff. One of the few things that's happened is come down and steal. But well, let's end that.