SOTS 2nd Hour: Fed Commentary Hits Stocks, Nike & Fedex Warnings, Musk Says “Hold Onto Your Stock” 3/21/25

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Sara Eisen (1:06)

Good Friday morning and welcome to another hour of Squawk on the Street. I'm Sara Eisen with Mike Santoli, live from Post 9 of the New York Stock Exchange. Stocks are in sell-off mode again here. Look, we got a sharper, sharply down open, and we're continuing to see the declines. Down 0.8 on the S&P 500 For the NASDAQ, down 0.7 of a percent. You have every sector lower right now, even sectors like energy, which have actually had a pretty good week, up 3% for the week. And financials, which are also up for the week. Healthcare up for the week, everybody's down today. But tech is leading declines in video, Micron, Broadcom, Microsoft, all lower. For a change, Tesla's higher. Also some gains in Netflix and Meta. So it's not universally lower, but we are down sharply across the board. Goldman, biggest decliner on the Dow. Take a look at Treasuries right now. Buying in Treasuries yields a little bit lower. The 10-year yield, 4.2%.

So we're not seeing pretty sharp declines in Treasury yields, but we are seeing declines right now, and the two-year yield just below 4%. Thirty minutes here into the trading session here, three big earnings movers were watching. FedEx, one of the worst performers on the S&P, cutting its full-year profit and revenue forecasts. On the call, executive mentioned weakness or softness in the industrial economy at least nine different times. More on that story ahead. Nike is also under pressure. Warning sales will drop by a double-digit percentage in the current quarter, that's the fourth quarter. The company facing new tariffs, sliding consumer confidence and slower than expected corporate turnaround. The streets take also coming this hour. And then watch Lennar, the home builder, posting a top and bottom line beat, but the company's chairman calling out a quote, challenging macro economic environment due to high interest rates, inflation, and a limited supply of affordable homes. More on the housing trade later this hour. But Mike, another day we have declines, just when we were starting to wonder if we were finally going to eke out a gain for the S&P this week, break the four-week leasing streak, find some sort of bottom or short-term bottom in some of these beaten down tech stocks. Here we go again today.

Michael Santoli (3:06)

Yeah, pretty apprehensive. I mean, I've been referring to last week's low, which culminated with that Friday rally as a credible one, a plausible one to have it be a short-term low, but not necessarily one that was a slam dunk, that this is done. We barely got to 10%.

You didn't really get a lot of the signals looking super washed out.

It has been largely MAG-7 driven, year-to-date. MAG-7 down like 14%. Rest of the S&P is actually slightly positive at the open.

Sara Eisen (3:34)

I showed the equal weight. 493 were positive year-to-date while MAG-7.

Michael Santoli (3:39)

And so, you know, there's room for adjustment. And I think the idea of a tightening consumer spending situation is obviously getting into the market a little bit more than it had been before. What we know is 40% of 10% pullbacks in the S&P 500 go on to 15% or more. So the majority don't, but a lot do. Most even if they're successful at just the 10%, get some kind of a retest period. And it's just hard to see knowing what we know is coming in terms of April 2nd. And in terms of first quarter earning season, which I think there's a lot of concern starting to build up around pre-announcements and what guidance is going to look like, it's just hard to see people feeling comfortable saying something's going to come along to make me raise my estimates here. And it just that that I think is makes it tough for the market to sort of get up up in a way.