SOTS 2nd Hour: Intel’s Lifeline, The Retail Wrap-up, & LIVE: Palo Alto CEO 8/19/25

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Sara Eisen (0:50)

Good Tuesday morning. Welcome to Squawk on the Street. I'm Sara Eisen with Carl Quintanilla and David Faber. Live, as always, from Post 9 of the New York Stock Exchange. Stocks are coming back from some lower levels earlier this morning. S&P 500 unchanged right now. Why? Because some of the groups are doing well. Real estate is up 1.25%. Consumer staples, materials, discretionary, health care, financials, utilities and industrials all higher. But technology is under pressure. That's why the NASDAQ Comp is down about half a percent. So relief in some of the rate-sensitive sectors. Also relief in some of the cyclical sectors this morning as well. Despite some gains in tech in Palo Alto and Intel, we'll talk about some of those moves in a moment. As for Treasuries, we kick off the week. The focus is on Jackson Hole later in the week. Fetch your Powell speech. There's buying today. The yields are lower, 4.3 percent on the 10-year. Two-year yield moves south to 3.74. As mentioned, just a moment, Palo Alto Network CEO Nikesh Arora joins us first on CNBC as the cybersecurity company climbs this morning on strong earnings and guidance.

Plus, mentioned Intel, Softbank, betting big on Intel shares surging. We'll talk about what's behind the company's multi-billion-dollar investment in the chipmaker and whether the US government stake could be coming next. But first, guys, as we look ahead to the week, we are getting some big-box retailers reporting, and the view on the US consumer continues to evolve. Value is a word that I continue to hear. Consumer is resilient, and yet, you know, there are still some issues out there. So let's start with Home Depot, for instance. They talk about a consumer that's making choices out there, the Home Depot CEO. Comps got markedly stronger as the months went on through the quarter. We definitely saw broader engagement across the portfolio. These are the best comps we've seen across the most departments in nearly two years. Consumers, both pro and consumer, engaged broadly across the business. But granted, in smaller project, we still haven't seen the recovery in the much larger discretionary projects, but I did think that that was sort of bullish when it comes to the note sounded by Home Depot. Viking Cruises will talk to the CEO next hour. This is hot play on the higher end cruising customer. Really strong demand, according to the CEO. They are from our consumers. In fact, we had an outstanding June and July, and we continue to see that booking strength continued into August. I would say the same for Amr Sports, which owns a lot of sort of Arc'teryx and Wilson. DTC Momentum continues to be fueled by both new and existing consumers across all regions, channels and product categories. We'll get Target, Walmart later in the week for a read on the consumer. But so far, not too shabby.

Carl Quintanilla (3:27)

Yeah, definitely bottom up sounds better than top down. Pantheon with a good note yesterday that household real after tax income is growing at about a 1% annual rate, obviously a little bit lower than what inflation is running. So we'll see. And hopefully Jackson Hole can maybe give the market a little more confidence about what's coming.

Sara Eisen (3:46)

I mean, who knows? I mean, he can either I could see either scenario where Powell says, you know, plays down expectations for rate cut in September because of hotter components of the latest inflation reports. That would be a disappointment to the markets or says, you know, we're on track. We just need to see some more good inflation numbers like Gulsby said on Friday. As for, you know, consumer and trying to read the tea leaves, you mentioned Pantheon. I noted the Bank of America note. They looked at deposits. So throughout COVID, right, deposit checkings and saving deposits were really high because of stimulus checks and people were at home and they were saving more. This is by income group and the little dotted line in the middle there they're looking at is sort of inflation adjusted 2019 levels. So during COVID, you can see it boomed way above the pre-COVID levels. That's checking in savings.