SOTS 2nd Hour: The Big Banks Breakdown, Value Investing Picks, & A Washington Wrap-up 1/14/26

SPEAKER_1 (0:00)

This episode is brought to you by Schwab Market Update, an original podcast from Charles Schwab. Join host Keith Lansford for this information-packed daily market preview delivered in 10 minutes or less, including projected stock updates, monetary policy decisions, and key results and statistics that may impact your trading. Download the latest episode and subscribe at schwab.com/marketupdatepodcast, or find Schwab Market Update wherever you get your podcasts.

SPEAKER_2 (0:28)

At Capella University, we believe accessible education can make a difference. That's why we offer scholarship opportunities to all eligible students. Un futuro diferente está más cerca de lo que crees con Capella University. Learn more at capella.edu.

Sara Eisen (0:43)

Good Wednesday morning, welcome to Squawk on the Street. I'm Sara Eisen with Carl Quintanilla and David Faber, live as always from Post 9 of the New York Stock Exchange. We're beginning here with breaking news this hour, as we await a potential Supreme Court decision on President Trump's tariffs, which could come this hour. Let's get right to our Eamon Jabbers in Washington with a look at what to expect as we await whether we'll get that decision today, Eamon.

Eamon Javers (1:06)

Yeah, Sara, we don't know whether we're going to get that decision. What we know is that the Supreme Court has said it has what they call two boxes of decisions this morning. So we are going to get some decisions from the Supreme Court. We just don't know which ones. They're expected at the top of the hour at 10 a.m. But this could trickle out over a couple of minutes as we see those decisions being issued by the Supreme Court. So we're going to watch and wait here. But at stake is the president's, more or less, the president's entire tariff agenda. This is, remember, just the IEPA tariffs. That's the International Emergency Economic Powers Act. And at stake is about $133 billion worth of tariffs that the president and the administration have collected during the course of this past year.

Does the Supreme Court say those tariffs were collected unconstitutionally and therefore does the administration have to reimburse that money to the companies that paid? That's what's on the line here. Or could we get some sort of more muddled Supreme Court decision, which is a lower threshold than invalidating the entire thing and forcing the administration to pay back the money? We just don't know as we sit here. So we're going to watch, this is exciting stuff. This is live TV breaking news without a safety net. And we'll see what we get.

David Faber (2:22)

All right, Aiman, we will get back to you as soon as you know something. Let's get some economic data that just crossed from Rick Santelli. Diana Olek also has some news for us as well.

David Faber (2:30)

Rick, we'll start with you.

Rick Santelli (2:32)

Yes, David, business inventories for October, fourth quarter number expected up 1 10th of a percent comes out up 3 10ths of a percent. And last month also joins the up 3 10ths club, a revision from up 2 10ths. So back to back 3 10ths for November and October. And they're tied for the second highest builds on business inventories of 2025 The high was up 4 10ths in January of 2025 Of course, the more widgets you make on the inventory side, the more you contribute to GDP. And GDP for the fourth quarter is already expected to be rather large. We also have existing home sales for December. And for that, we aim east to Diana Olick. Diana?

Diana Olick (3:18)

Well, Rick, existing home sales in December rose 5.1% from November to a seasonally adjusted annualized rate of 4.35 million units. That's a strong beat. The street was looking for a 2% gain. Sales were up 1.4% year over year. Now, this count is based on closings. So contracts likely signed in October and November when the average rate on the 30-year fixed mortgage didn't move very much, hovering around 6.2 to 6.3%, but down from close to 7% where it was last spring and early summer. Inventory was the big headline. 1.18 million units available for sale at the end of December, down 18% from November, still up 3.5% year over year.

With stronger sales though, that dropped to a 3.3 month supply, which is considered quite lean. That kept prices in the positive, just barely $405,400 was the median sale price up 0.4% annually. That is down from a 1.2% annual gain in November. Sales continue to be more robust on the highest end of the market, and homes are staying on the market longer, 39 days on average versus 35 days a year ago. We do not have any data on first-time buyers, investors and all cash as the realtors are now waiting until the end of the month to report that. Sara?