SOTS 2nd Hour: Live: US Steel CEO, Jensen Huang’s CES Keynote, Apple & Tesla Downgraded 1/7/25

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Success starts early. Worldwide Exchange, 5 a.m. Eastern CNBC.

Sara Eisen (0:46)

Good Tuesday morning. Welcome to another hour of 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. Mixed picture for stocks. S&P 500 is a little bit higher, and it is not technology today leading the way. It's actually health care for a change, which is up 1.3% as a sector. Materials, consumer staples, so all the laggards from last year are actually at the top of the market. Energy, utilities higher as well. Technology is under pressure. That's why the NASDAQ is down a third of 1%.

But again, we're still coming off of a strong rally yesterday. Treasuries may be the culprit here. We are seeing higher yields across the board. The 30-year yield at the highs of the year, the 10-year and the 2-year, the 10 years at the highest since May and then the spread really steepening there at the highest since May 2022 That's the difference between the 2-year and the 10-year. We'll talk about it. 30 minutes here into the trading session. Here are three movers we're watching. Nvidia is down right now but did hit a new all-time high following CEO Jensen Huang's speech last night. We're going to break it down, discuss what's next for that stock. Apple also trading lower stock downgraded to sell at Moffitt-Nathanson, $188 price target. The firm's citing China concerns mainly and the government's antitrust lawsuit versus Google. We're also keeping an eye on Meta. The company's scrapping its third-party fact-checking program and implementing a community notes model similar to the one that exists on Elon Musk's X. Meta also adding UFC's Dana White to its board. Very interesting.

Carl Quintanilla (2:15)

Getting some important ECO data crossing the tape. Let's get to Rick Santelli this morning. Hey Rick.

Rick Santelli (2:21)

Hi Carl, indeed. Look at those rates zooming. Watch stocks making session lows. What's going on?

Carl Quintanilla (2:27)

Jolts.

Rick Santelli (2:28)

Job opening labor turnover surging. We're expecting a number around 7,750,000.

8,098,000. 8,098,000. That is the biggest job openings amount going all the way back to May of 24 Now, ISM also pretty warm. We're looking at services. This is the PMI's. 54.1 on headline. Better than expectations. Sequentially higher than 52.1. 54.1 would end up being the strongest going back to just October this year when it was 56, but that number was the highest going back to July of 22 Prices paid moving in the wrong direction. 64.4. Well above the 57 we're expecting. Well above the 58.2 in the rear-view mirror. 64.4. How does that comp? That would be the hottest. Prices paid going back to February of 23 Feb of 23 New orders. 54.2. Exactly as expected. Warmer than 53.7 in the rear-view mirror. And 54.2 ends up comping. Well, since October when it was 57.4. And finally, services employment side. And this is important considering we have jobs, jobs, jobs, Friday at the end of the week. 51.4 exactly as expected. But this is the only number that is sequentially lower than our last look. So 51.4, last look 51.5.

So interest rates are zooming, you have hot prices paid, generally warm services, and a very warm job opening labor turnover. We want to monitor how this may affect the 10-year auction at 1 o'clock Eastern. 39 billion tens go on the auction block. Sara, back to you.

Sara Eisen (4:24)

Yeah, we'll look to you for those results. Thank you very much. Rick Santelli. I mean, that was a bunch of data about some of the risks we've been talking about, that the economy is in good shape and that inflation pressure is not over yet. And Rick highlighted that in the Prices Paid Index, the fact that there were more than 8 million job openings expected fewer than 8 million job openings. We know the Fed pays attention to that rate especially between the job openings compared to the unemployed. So this suggests things are in really healthy shape and the Fed is right to pause. Maybe it was wrong to cut 100 basis points.