SOTS 2nd Hour: Nvidia Record High Watch, Tech Bears Get Burned, and U.S. Steel Lawsuit Latest 1/6/25

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Sara Eisen (0:32)

Good Monday morning. Welcome to another hour of Squawk on the Street. I'm Sara Eisen with Carl Quintanilla, who's back. We are live at Post 9 of the New York Stock Exchange. David has the morning off. Stocks starting on a high note here. The S&P is up a full percent right now. It's being led by technology, which is why the NASDAQ is also up one and a half percent, having a really strong start. After what's been a bumpy few days to start 2025, utilities and consumer staples, both defensive sectors under pressure. Everybody else is higher right now. And of course, it's being led by a lot of the usual suspects, the mega cap tech names, especially the chips like Micron or Applied Materials, Marvell Technology, MicroStrategy, Broadcom. These are all the leaders today. As for treasuries, the theme has been higher treasury yields, and that's been a little bit of a roadblock for stocks. The 10-year note yield a little higher this morning, firmer at 4.624. So we're back above that 4.6 level, two year also, near 4.3.

Through 30 minutes here into the trading session, here are some movers we're watching. Ride-sharing names in the green, Uber announcing a $1.5 billion accelerated share buyback program, while Lyft gets an upgrade to buy over at Benchmark, both stocks higher today. We're also keeping close eye on the semis. I mentioned they're on the move after Foxconn reported record sales in Q4. Meanwhile, Nvidia CEO Jensen Wong set to give a big speech tonight. More on that coming up. And then T-Mobile, one of the biggest losers on the S&P after both Wells and RBC downgraded the name to neutral on valuation concerns. But it's Nvidia really taking the lead in this chip rally.

Carl Quintanilla (2:03)

Be a big night tonight. Got some PMIs today to work with. Also factory orders a few moments ago. Let's get to Rick Santelli. Hi again, Rick.

Rick Santelli (2:11)

Hi. Good morning, Carl. Yes, factory orders. These are going to be fresh November numbers. On the headline, we're expecting down three tenths. It comes out a bit worse down four tenths. But there is something positive here. If you look at last month, October, it was originally up two tenths. It now becomes up five tenths. So that helps mitigate some of the weakness in the fresh number. Now transportation was definitely a drag because once you separate transportation, we now end up with up two tenths of a percent. That's a little bit better than we are expecting. And also a positive revision to October from up one tenth to up two tenths. Now we're going to look at durable goods. These are November final reads, which means there were mid month reads. We're going to replace. And if we look at the mid month read, it was minus one point one on headline durable goods, which now becomes minus one point two. Minus one point two would be the weakest going back to June when it was minus nearly seven percent. Once again, if you take out transportation, the number improves. It goes from minus one point two to minus two tenths. It was minus one tenth at the mid month read.

If we look at the non-defense X aircraft on capital good orders up four tenths, that's much less than the up seven tenths on the mid month read. And finally, switching from orders to shipments, we move from five tenths up half one percent mid month read to up three tenths. So every single one on durables on the mid month read deteriorated to its final read. Something to note today, that two's tenth spread is hovering at 34 basis points. That's the widest, the steepest it's been in 32 months, going back to May of 22 Carl, Sara, back to you.

Sara Eisen (3:57)

Okay, Rick, thank you very much. Kicking off a busy, somewhat busy data week that we have ahead. The highlight is going to be jobs on Friday. We'll get the December jobs report. Also, because it's a jobs week, the jolts, which is always exciting, the job openings data, which we know the Fed pays close attention to. We'll get ISM services also on Tuesday, which is the big swath of the economy, the services part. The minutes from the last Fed meeting, where the Fed sort of pivoted its tone toward a more hawkish or pause-y standpoint from the cuts. So that will be a good read. And then Thursday, even though the market's closed, we will get jobless claims. You know, Carl, there's some Fed speak to mention over the weekend. We heard from two key Fed meeting members at the American Economic Association in San Francisco. And I think it's they summarize basically the push-pull going on at the Fed for what to do. Here's Adriana Kugler, the governor. We are fully aware that we are not there yet. No one is popping champagne anywhere. And at the same time, we want the unemployment rate to stay where it is. So acknowledging that we're not a 2 percent inflation target and doesn't mean we're just going to go straight cutting until then. But also they're worried about jobs. And Mary Daly, San Francisco Fed president, really reiterated that on jobs.