SOTS 2nd Hour: Semis Surge, Fmr. Treasury Secretary Lew & The Big Banks Breakdown: Day 2 1/15/26

SPEAKER_1 (0:00)

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SPEAKER_2 (0:28)

Hey Fidelity, how can I remember to invest every month?

SPEAKER_3 (0:34)

With the Fidelity app, you can choose a schedule and set up recurring investments in stocks and ETFs.

SPEAKER_2 (0:40)

Oh, that sounds easier than I thought.

SPEAKER_3 (0:42)

You got this.

SPEAKER_2 (0:43)

Yeah, I do.

Carl Quintanilla (0:45)

Now, where did I put my keys?

SPEAKER_3 (0:48)

You will find them where you left them.

SPEAKER_5 (0:52)

Investing involves risk, including risk of loss.

David Faber (0:53)

Fidelity Brokerage Services LLC member NYSE SIPC.

Sara Eisen (1:05)

Good Thursday morning. Welcome to Squawk on the Street. I'm Sara Eisen with Carl Quintanilla and David Faber. We are live as always from Post 9 of the New York Stock Exchange. Coming up on today's show, former Treasury Secretary Jack Lew with us to talk about the investigation into Fred Shere Powell, the macro setup as more data rolls in. Plus oil prices getting whipped around here in recent days as headlines out of Venezuela and Iran move forward. RBC's Helima Croft will join us to separate the news from the noise. And chip stocks in focus this morning as Taiwan Semi reports a 35% jump in profit. We'll look at the other names getting a boost from that report. But guys, we gotta talk about jobless claims. That was a wow good news report. Yes, we get jobless claims every week. Yes, there's seasonal volatility. But to see the number drop below 200,000 for the last week and then a revision lower for the prior week, that's really good news. It means that fewer Americans than economists were looking for are filing for unemployment claims. We're at a six week low, lowest level since November 29th on jobless claims. The four week moving average, which sort of smooths out some of the bumps around the weekly numbers, also down to 205 and the lowest since January 20th, 2004 We got a market reaction out of this one. We saw bonds, for instance, sell off, higher yield, especially at the short end, the two year. Fed doesn't have to do as much if they don't have to be as worried about the labor market. The dollar strengthened, and then this is one of those reports, Carl, where one of the biggest debates, and David, going into the year and right now has been, is the labor market really weakening? How much is it weakening? Do we have to be worried about that? This is a report that tells you we do not have to be as worried about the labor market. Yes, we're not seeing as much hiring on the monthly jobs numbers. But again, that could be lower supply of workers.

It could be AI starting to filter into businesses. The good news is when jobless claims are elevated, that is a sign of stress, economic stress, businesses are cutting back. We are not seeing that at all.

David Faber (3:08)

Yeah, I mean, the, Doug would argue unemployment rate above, like say the three year average generally leads you into a recession. But a lot of, you know, we're sort of blind on data. Goolsbee this morning says he really wasn't surprised to see this kind of claims number. And it kind of explains why rate expectations are kind of faltering here going into the first half of the year.

Sara Eisen (3:28)

Yeah, I mean, it's good news if the Fed doesn't have to cut as much because they don't have to be as worried about the labor market. It's bad news if you're just rooting for Fed cuts all the way. But look, I think that it's hard to talk about a labor market weakening into a recession with jobless claims below 200,000. It just doesn't jive. And I'll add one other piece of good news. You know, the beige book, which is constantly downbeat. It's all the color that the feds collect from all the different districts. It was out yesterday afternoon. And look at this. Overall economic activity increased at a slight too modest pace in eight of the 12 districts with three districts reporting no change and one reporting a decline. This marks an improvement over the last three report cycles, where majority of districts reported little change. Last time we got beige book, it was all about weakness for labor. This time around, it was about increased demand. I mean, in all sorts of places. Yes, there's a lot of references to better snow seasons, snow falls in places like New Hampshire for the Boston District, the Philadelphia District also talked about better snowfall for some of those results resorts. But it wasn't just that, it was overall a sense that the economy is getting a little momentum here.