SOTS 2nd Hour: M&A Under Trump, Tariff Tech Picks, & DeepSeek-ing New Funds? 2/19/25

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Carl Quintanilla (0:59)

Good Wednesday morning, welcome to another hour of Squawk on the Street. I'm Carl Quintanilla with Courtney Reagan here at Post 9 of the New York Stock Exchange. Sarah Eisen has the morning off. David Faber is going to join us a little bit later with a big interview. Meantime, some moderate losses this morning, doused down about 150, backing off of yesterday's all-time highs on the NASDAQ and S&P, oils up a buck, yields creeping a little bit, still holding that level around 455 on the 10-year.

Courtney Reagan (1:23)

And we are 30 minutes into the trading session. Here are three movers that we were watching so far. Toll Brothers, under pressure after the home builder missed earnings estimates. Impairments and a delay in the sale of an apartment property at one of its joint ventures were key drags on the results. You can see shares down more than 6%.

Other home builders like Pulte, Lennar, DR Horton, KB Home, also under pressure this morning. It looks as if KB Home, they're down the worst of the bunch, down 2.4%. Now Bumble shares also plunging and disappointing guidance. Revenue down year over year in the quarter. Shares now cut in half over the last year, down more than 22% at this point. And we're keeping an eye on Apple today. The tech giant expected to unveil an upgrade to its most affordable iPhone, the iPhone SE4. We're going to bring you that latest news when it processed.

Carl Quintanilla (2:08)

Let's turn to the broader markets this morning. Stocks are in the red after those fresh record closing highs on the S&P and Nasdaq. Our Senior Markets Commentator Mike Santoli is here with the setup, Mike.

And Jim's point last hour about how we're having to get reconditioned to the pace of news like we were post 2016

Mike Santoli (2:24)

Yeah, I think that's been part of the process of the last few weeks, is essentially to know what to extrapolate, what not to, how to perhaps kind of take a step back and not react to anything that's not yet substantive and firm. So I think that's part of what's been keeping the market in check, in a sense. So we keep feeding off of very positive set of initial conditions, right? The economy growing well coming into the year, earnings are up, you know, as the usual, 77% of companies beating estimates and we're beating by 7 percentage points. So you've kind of justified the valuations on that level. And the market just continues to rotate around. Whenever it looks like there's one area that's going to kind of compromise the strength of everything else, something else offsets it. Now, I don't know that that could last forever. What's fascinating, yesterday it was a sort of a direct out of growth into value type of move. Today, it's essentially spilling back the other direction. Yesterday banks are up 1 percent. Today banks are down 1 percent. So I think that that kind of favorable ability of the market to kind of move its weight from foot to foot is a good thing. But it means that this move to a new high, not the most emphatic, it does not have a ton of broad momentum behind it.

It's more kind of a grind, a net positive and not something that says, we expect either an economic acceleration or that we have the capacity to be surprised pleasantly to the upside very much because I think we came into the year with good expectations.

Courtney Reagan (3:52)

It is startling to me, like you said, that we're getting a little bit more used to the reaction factor waiting until it's real news before we move. Anything that you think could change sort of that tendency as we move forward. I mean, these announcements are coming out of Washington in rapid acceleration. It's hard to keep up.