SOTS 2nd Hour: Navigating the Sell-off, Blackstone COO on Credit Concerns, & LIVE: Target CEO 3/3/26

SPEAKER_1 (0:00)

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Sara Eisen (0:28)

Could this vintage store be any cuter?

SPEAKER_5 (0:31)

Right? And the best part? They accept Discover.

SPEAKER_6 (0:33)

Accept Discover?

SPEAKER_7 (0:35)

In a little place like this?

Michael Fiddelke (0:36)

I don't think so, Jennifer.

Morgan Brennan (0:38)

Oh, yeah.

SPEAKER_5 (0:39)

Discover is accepted where I like to shop.

SPEAKER_7 (0:41)

Come on, baby.

Morgan Brennan (0:42)

Get with the times.

SPEAKER_6 (0:43)

Right. So we shouldn't get the parachute pants?

SPEAKER_5 (0:47)

These are making a comeback.

Morgan Brennan (0:50)

I think.

SPEAKER_5 (0:51)

Discover is accepted at 99% of places that take credit cards nationwide. Based on the February 2025 Nielsen Report.

Carl Quintanilla (0:58)

Good Tuesday morning. Welcome to Squawk on the Street. I'm Carl Quintanilla with David Faber live at Post 9 of the New York Stock Exchange. Sara Eisen's live at Target headquarters in Minneapolis. More from her later on this hour. In the meantime, markets are under severe pressure today. All sectors are red. Dow's down about a thousand points. Breath overwhelmingly negative and this level will take the S&P back to say mid-December. Two big interviews this hour. Blackstone's president and COO Jon Gray is going to join us exclusively. Talk about these record redemptions for the firm's private credit fund. And an exclusive with the CEO of Target, with Sara's first interview since taking the helm. Sara's got a lot more on what to expect from them on this Investor Day, Sara.

Sara Eisen (1:40)

Carl, good morning. It's a big day here in Minneapolis. Not only did Target release earnings, but it's the first time that the brand new CEO, Michael Fiddelke, is laying out his turnaround plan for investors and analysts here at headquarters. That's why we're here. On the results, another down quarter, comp store sales declining 2.5 percent, profits fell 1.5 percent from last year. But there is some good news here for the future, which is why the stock is reacting positively. The company is projecting 2 percent sales growth for the year after three straight years of declines. We're going to find out why.

And how a CEO that has been at Target his whole career since starting as an intern 23 years ago is the right person to lead the company out of this multi-year sales slump. I think the stock really tells the story. If you zoom out, just look over the last three years, Target against one of its big competitors, which is Walmart, has underperformed and seeded market share. But Fiddelke told me this morning there is a big opportunity to differentiate and draw customers. We walked through here at headquarters some of the displays about how he is planning to change it up and already doing so on apparel, on beauty, on toys, home. These are the core categories that Target used to dominate. We're going to talk about all of it, talk about some of the consumer headwinds, including today's big surge in oil prices on this war in Iran and more in just a few minutes, guys, when we sit down with Fiddelke for an extended exclusive interview. All right.

David Faber (3:06)

Looking forward to that, Sara. Of course, let's get back to the markets. We are down over 2% on both the NASDAQ and the S&P. Our senior market commentator, Mike Santoli, joins us here at Post9.

And Mike, obviously, we've got concerns about private credit that continue, continued concerns, so to speak, around AI. And then we seem to have a different reaction today, perhaps, to the hostilities in the Mideast than we did yesterday.

Michael Santoli (3:30)

Yeah. The market yesterday, I think, tried to bet that it could escape the way it has for the last three months, really, which is, through rotation. You know, meet out the punishment to the areas of the market most exposed, to global trade, oil, and then buy something else to support the indexes. Today, you crashed through all that. And I do think it was a matter of, if WTI stays under 70, we can live with it. If it seems more open-ended and it has more altitude toward 75, then we have to reprice according to that. I also think this notion of, you know, it's not going to be quick and surgical and necessarily contained has weighed on the markets. But to your point, I do think it's because the market itself had been getting away easy. And I've been trying to talk about this for weeks. With how much internal volatility there had been, the S&P was kind of pulling a rabbit out of the hat and staying supported. Now, what do we have today? We cracked through the floor that had been in place for year-to-date on the S&P, which was like 67.75. We're a little bit below that. We're just above the December lows, which is 67.20. So it starts to get a little trickier. Carl, you mentioned how negative breath is on the S&P, more than 90 percent downside value. That's new because we've been in one of these, buy something to sell something else and try to trade around it. So maybe that means this is the beginning of some kind of a flush. We're three and a half percent off the all-time highs. Let's keep that in mind. So it's not like you're cutting into muscle just yet, but it's hard to know what clarity looks like here. If you just have to get kind of oversold, get a little bit of a sense that maybe there's going to be de-escalation and then the stuff that's already been beaten up maybe performs, because that's what happened yesterday. Relief bounces in software, in some of the credits exposed names, and then you had Mag-7 kind of doing its little bit to try and support the indexes. Today, Mag-7 is outperforming, not by a lot, but it's outperforming, and software, the IGV, is down less than the market and it's holding above 80 bucks, which is sort of the line of, you know, where the low might be put in place. So I think the market is kind of going after the stuff that is crowded and has a lot of profits underneath it. The Korea market getting crushed.