SOTS 2nd Hour: More S&P Record Highs, Netflix Breakdown, LIVE: Deputy Treasury Secretary 7/18/25

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Sara Eisen (1:01)

Good Friday morning. Welcome to Squawk on the Street. I'm Sara Eisen with Carl Quintanilla. We are live from Post 9 of the New York Stock Exchange. David Faber will actually join us later. There's just too much happening in the deal world today. As for markets, record highs, another strong day and another strong week for the markets. We lost a little bit of momentum on the Dow. S&P is up a quarter of a percent. The NASDAQ is also up a quarter of 1%.

We're still tracking for an almost 2% gain this week for the NASDAQ and almost 1% for the S&P. As for what's working best today, it's actually, well, technology is doing well, but consumer discretionary and energy, energy stocks doing well after Chevron gets the green light to go ahead with the head steel. Finally, CEO Mike Worth joining us last hour to discuss that and tech again, having another strong session. Treasuries right now, there's been some buying of Treasuries. We got housing starts a little bit better earlier today. Yields are lower, 4.4 on the 10-year, the two-year yield just below 4%. Longtime Market Watcher, Ed Yardeni will join us today to talk about how much more room there is left in this rally as we sit here at Records. Plus, we will talk to Deputy Treasury Secretary, Michael Faulkender, ahead of an expected Oval Office signing later today of the Stablecoin Genius Act. And much more ahead on the Deal News of the Day, Chevron completing that $55 billion acquisition of PES. As we mentioned, both stocks up, PES up 7.6% on the news.

Carl Quintanilla (2:23)

Got some data today. Youmish is up next. Let's get to Rick Santelli. Hey, Rick.

Rick Santelli (2:28)

Yes, Carl. Markets are moving on this. Some big news here in University of Michigan sentiment. $61.8 is the headline, better than expected, sequentially higher than $60.7 in the rear view mirror. That's the best level since February. Very solid number there. And if we look at the current conditions, $66.8, well above the $64 we were looking for. That's the second best number of the year, which means, of course, we're comping to January. Finally, if we look at expectations, what may lie ahead, also better than expected, also sequentially higher than our last look. $58.6, the best since February this year as well. Finally, maybe the most important number is that I believe the long end is going to like in terms of maybe a little more buying coming in, pushing yields down. The one-year inflation rate moved from 5% down to 4.4%.

4.3 is where we were in February. There's where your comp is. But we did in May have $6.6. That was the highest since $81. I do believe those were some distortions by some of the surveyed respondents. And if we look at the 5- to 10-year inflation, it moved down from 4% to 3.6. That also would comp to Feb when we were at 3.5. So better than expected data. We did see a little buying on the long end of the curve. We did see a little pop in the equity markets. But there's a lot of moving parts here. Maybe the most important thing I would pay attention to for the rest of this Friday is the dollar index. Last week, it closed at 97.85. Right now, it's at 98.14 and changed down about a half a cent. If that starts to go negative on the week, that would be very significant. Sara, back to you.

Sara Eisen (4:13)

OK, thank you. We're watching it. Rick Santelli, a good data point on consumer confidence, highest confidence in five months. It jives with the story, Carl, which is less bad than feared. You know, that's been the whole story when it comes to earnings this week. It's been the story with the 30% market rebound from the April lows, and it's continuing to show up in the data here. So confidence improving and, importantly, what Rick just said, their inflation expectations coming down. That was actually a plunge in long term inflation expectations. That's, you know, chalk that into one for Waller versus Powell on that front, because if there was really an inflation problem starting to creep in, you would see higher inflation expectations both in the market and, as the Fed has cited before, in surveys like University of Michigan. So it's good to see those numbers come down, as Rick said. We talked about what the word is from corporate America, confidence improving, things getting better than feared. I'm not talking about a booming economy, but a better economy than they thought when those tariffs were initially announced. We heard from some regional bank CEOs, for instance, about this. Listen.