SOTS 2nd Hour: China-U.S. Trade Talks Latest: Market Implications, Plus Apple WWDC Breakdown 6/9/25

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Sara Eisen (1:06)

Hello, good morning. Monday morning, and welcome to Squawk on the Street. I'm Sara Eisen with Carl Quintanilla and David Faber. We are live from Post 9 of the New York Stock Exchange. Stocks are, they've been up and down this morning. They're a little bit firmer right now, but just barely for the SMP. The Dow is actually lower by 100 points, and the NASDAQ is up by a quarter of 1%. This comes after a big rally on Friday and last week. Still more than 20% off those post-Liberation Day lows in the market. Little direction, we're waiting from word on the China-U.S. trade talks happening in London. Waiting for some key economic data this week as well. Take a look at how treasuries are kicking off the week. It's a mixed picture. The long end, 30 years actually a little bit higher, bumping up against that 5% level just below there. But there's buying in the rest of the curve, the 10-year yield 4.496, the 2-year yield also a little bit lower at 4%.

Those high-level trade talks between the US and China, they are just getting underway in London. We're going to talk to a long-time market expert, Ed Yardeni, about how investors should be viewing today's meeting. But the major average is closing in on record highs, just a few percentage points away. Plus, Apple kicking off its Worldwide Developers Conference. Big questions remaining about the company's AI strategy. We'll take you to Cupertino for the latest.

Carl Quintanilla (2:20)

Let's get some inventory numbers with our Rick Santelli. Morning, Rick.

Rick Santelli (2:24)

Good morning, Carl. Yes, on the inventories, these are wholesale inventories and the April mid-month three now turns into a final.

It was unchanged, it now pops up to two-tenths of a percent. And this is notable because January, February, March, and now April are all creating inventories in a descending order from the highest eight-tenths in January to now up two-tenths. So four months in a row of positive change. Last year, we ended down seven-tenths, so we could see a build going on. Now the question is, on a fresh number, how much is turning into sales? We're expecting April sales to be up three-tenths of a percent. Comes in a smidge light, up one-tenth of a percent, and last month does get revised up two-tenths. So it kind of comes out in the mean wash from six-tenths to eight-tenths, and we want to pay attention to sales. They started out negative with nine-tenths in January. We do see some activity building there, as we all keep very much paying attention to some of the pull forward that we've experienced this year on inventories due to tariff issues. As Sara pointed out, interest rates are a smidge lower on all maturities except for a 30-year bond, which is virtually unchanged. Sara, back to you.

Sara Eisen (3:41)

Okay, thank you, Rick. Rick Santelli, we are going to get some key data releases, both hard and soft data. So surveys like Small Business Optimism is out tomorrow, and key data that the Fed's really going to pay attention to, like CPI, consumer prices, inflation, PPI, the wholesale price inflation later in the week. And then another important read on consumer confidence on Friday. Speaking of this whole hard data, soft data gap we've seen, right? Where the consumer confidence plunged in the wake of some of the tariff announcements and the spending data didn't really follow suit. Goldman Sachs had an excellent chart looking at so far this year, hard data in blue, soft data in orange, and then the S&P 500, the market in between. What you can see is that the soft data plunged, right? People got pessimistic, optimism faded, but it's starting to come back. What they're suggesting here is it's actually leading the hard data. The hard data remained pretty resilient. It's dipping now because maybe that soft data led, but there's room for hope because the soft data, the survey data is getting better. Maybe they're saying, brush off some of the weaker economic data we're seeing here because there are signs that it could be churning and it could have bottomed. Let's see what we get on Friday from Consumer Sentiment.