SOTS 2nd Hour: Tariffs Latest, CPI Breakdown, and Dalio on the Deficit 3/12/25

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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 Leslie Picker, Michael Santoli live at Post 9 of the New York Stock Exchange. David and Sarah on assignment. Bulls doing a little nibbling at least this morning. S&P back to 5600 By the way, yesterday's low 5528

CPI did come in cool. Ten-year yield comes back to 43 and then some. By the way, quick programming note. Do not miss a big interview tomorrow on Squawk on the Street. Our Sarah Eisen is going to talk to the Treasury Secretary, Scott Besant, about everything from market volatility to the impact of tariffs.

Leslie Picker (1:31)

Very much looking forward to that. We are 30 minutes into the trading session. Here are some movers. We are watching Intel shares rallying. And there are reports out there that Taiwan Semi has pitched NVIDIA, AMD and Broadcom about taking stakes in a joint venture to operate Intel's factories.

Taiwan Semi reportedly proposing to run the operations of Intel's Foundry Division, which makes chips for customers, but it would know more than 50 percent. Those shares up about 6 percent right now. Morgan Stanley cutting its price target on Apple to $252, a share from 275 saying the delayed AI Siri update means Apple will have fewer features to fuel iPhone upgrade rates. Those shares about flat right now. And Tesla shares trying to rebound for a second day. Oh, there you go. Up 7.3 percent. Very much rebounding, but still on pace for losses on the week and hovering right around 50 percent off of their 52 week highs.

Carl Quintanilla (2:28)

Meantime, as we said, stocks trying to rebound after we fell into correction tour yesterday on yesterday's trade. Mike, what are you watching and are there either positioning flows or sentiment metrics that are driving the conversation right now?

Michael Santoli (2:40)

They've been in the neighborhood for a few days of good enough usually to get an oversold bounce, but not too much more compelling than that. I think the CPI number, which was a bit lighter than anticipated, was at least one fewer thing piled up on the pile of negatives, and it cleared the way for at least a reflex rally attempt. It seems as if the market's acting like the urgent selling has dried up down at these levels. You get down to a 10% pullback, 10% correction, and it's at least a moment to stop and say, if it's going to get much worse than this very soon, you probably have to see a little more tangible evidence of outright economic weakness, of financial conditions tightening a lot more elsewhere, credits not really acting up too much. So I think that's the situation we're in. I'll channel the late great R. Cashin, which he used to say, after you've had one of these sharp gut checks, it's like a cardiac event, and what the person whose experience it does is, they're constantly checking their pulse, they're constantly sort of aware of all the little micro sensitivities that you might have, and that's where we are right now. So I think the gnomes that I look at, say 56.25 on the S&P could be significant. It's one of the waypoints that you would want to hit and close above that and say, okay, maybe that means that in fact you can have a fuller balance. Any initial rally is going to be suspect at this point, and obviously it's going to be headline dependent, but Leslie, I'll say it again. If this was all and mostly about tariffs every day, different stocks would be leading us down.

It's just not like GM and Ford going down every day, it's obviously one of the things that's weighing on the macro outlook, but it's not necessarily just that.