SOTS 2nd Hour: Chips Rip, Hantavirus concerns, & The Latest Iran Developments + Market Implications 5/11/26

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Sara Eisen (1:07)

Good Monday morning, welcome to Squawk on the Street. I'm Sara Eisen with Carl Quintanilla and David Faber. We are live as always from Post 9 of the New York Stock Exchange. Coming up this hour, Intel shares up again today after surging 14% on Friday. And Qualcomm getting a big lift as well in early trading. We'll talk to analyst Ben Reitzes about the wild action in this space.

Plus, Moderna moving higher as concerns over the Hanta virus grow. After news of a positive test for an American national, global health policy expert, Dr. Vin Gupta is with us to discuss. And the CEO of Nordic American Tankers will join us to talk about the latest in the Strait of Hormuz as President Trump rejects Iran's counteroffer to end this war.

Carl Quintanilla (1:47)

It's going to be an important week of data. First, let's get some existing homes with Diana Olick. Morning, Diana.

Diana Olick (1:52)

Good morning, Carl. Existing home sales in April basically flat. They rose just 0.2% from March to a seasonally adjusted annualized rate of 4.02 million units. Squawk on the Street was looking for a much larger 3% gain. Sales unchanged year over year. Now, this count is based on closing. So that's contracts likely signed in late February and March. The average rate on the 30-year fixed mortgage ended March in the 5.99%.

And then shot up sharply due to the start of the war with Iran. Now, inventory in April did rise 5.8% from March, just up 1.4% year over year to a 4.4-month supply. And that is still considered tight. That kept upward pressure on prices. The median price of a home sold in April, $417,700, up 0.9% from a year ago, but still the highest April price on record. Days on market did increase to 32 from 29 last April. First-time buyers at 33% down slightly from a year ago. And 1 quarter of all sales were made in cash. That is unchanged from last year. Now, mortgage rates have remained higher starting this week at 6.42%.

And other reports this month show while pending sales have increased some in the last couple of weeks, supply is tightening again. Sara, so that's going to keep that pressure up on prices.

Sara Eisen (3:10)

Okay. Thank you, Diana. Diana Olek. Guys, ahead of the president's trip to China this week to meet with Xi Jinping, I wanted to take a look at what's happening with the Chinese economy because we did get some numbers overnight on prices. Remember, we got CPI and PPI. So this is consumer price inflation and at the producer level as well. Remember, China has been battling deflation. It's actually had a problem with lower prices, which you can see where those numbers have been below zero for a while now. Guess what?

The impact of the Iran War is actually lifting China out of deflation and causing a surge in producer prices, which actually had their highest levels in about three years and consumer prices as well. Why?

Higher oil prices, higher commodity prices because of the Strait of Hormuz. There's also a travel period in China, which was helpful. But in a way, it's actually been helpful because they didn't want to be in a deflationary trap. So the fact is, they are seeing a little bit of inflation. When it comes to the China economic story, it's all about exports. I mean, their retail demand, their domestic demand has actually been weak. Here's the US versus China in terms of just pure economy. Remember, everybody was scared that China would overtake the US. I mean, it's not even close right now, according to the IMF. This is what it's going to look like this year, $20 trillion economy versus our nearly $32 trillion economy. And even by 2030, it is not supposed to get even close, according to the IMF. Yes, they've had strong exports. Yes, they've had strong industrial production. But domestic demand has been weak, especially looking compared to the United States, where the US consumer has done very well. There's the export numbers. I mean, that's the story. They didn't, everyone thought they would get hit by the trade war. They found, certainly found alternate sources of demand.