SOTS 2nd Hour: Trump Tariffs Latest, Nvidia Takeaways, Cracking Down on Eggflation 2/27/25

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Sara Eisen (0:51)

Good Thursday morning, welcome to another hour of Squawk on the Street. I'm Sara Eisen with Carl Quintanilla and David Faber, live as always from post-night of the New York Stock Exchange. Stocks started off higher, then we took a leg lower after President Trump announced new tariffs on China. We'll talk about that in a moment, but we've gone negative on the S&P 500 for the day. Down a third of a percent right now. Tech is getting hit the hardest, down 1.4%. It doesn't help that Nvidia is down 4%, Salesforce down 4%, Super Micro down 11.5%. Those are earning stories, but the overall market did seem to shift in terms of momentum. NASDAQ getting hit the hardest on those tech losers, down a little more than 1%. The Dow remains higher just barely. We'll talk about some of the media names that are higher as well. Warner Brothers Discovery at the top of the market today for a change up 7%.

Treasuries, got a lot of economic data to digest, to talk about. We're seeing some selling of bonds and that pushes yields a little higher, but we're still talking about sub 4.3 levels on the 10 year right now. The 2 year yield just below 4.1. We are 30 minutes here in the trading session here. Our three big movers we're watching. AI, Bellwether, Nvidia reporting a top and bottom line beat. Sales up 78% from last year. Solid revenue guidance as well for the current quarter, but there are concerns about margins ahead. We're going to get to the streets reaction in just a moment. Salesforce has mentioned also under pressure, earnings beat estimates, but revenue fell short. Guidance came in a little bit lighter than expected. And another morning of consumer results, from retailers to cruise lines to packaged food, all moving in opposite directions. And I'll share some of the commentary in a bit about what they're all saying about the consumer right now.

Carl Quintanilla (2:26)

Meantime, let's get some pending home numbers. Diana Olick, Scott Fedfors. Morning, Diana.

Diana Olick (2:31)

Good morning, Carl. Pending home sales in January fell 4.6% month to month to the lowest level ever. Or since the National Association of Realtors began tracking this in 2001, that is a big miss. The street was looking for a 1% drop, sales down 5.2% year over year. Now, this count is based on signed contracts. So it's people out shopping in January when mortgage rates were well over 7% for the entire month. These sales are an indicator of future closed sales. The realtors did mention exceptionally cold weather as a possible deterrent to buyers, but sales actually rose slightly in the Northeast, and they were down in the West where weather was less of a factor. Sales fell the hardest in the South, which had been the most active region of the country for sales. Now, this drop comes as inventories are significantly higher than they were a year ago, but affordability is taking its toll. Home prices have been easing over the past few months in some areas, but they're still higher than they were a year ago nationally. Consumer sentiment is also dropping, which could be weighing on buyers as well. Sara?

Sara Eisen (3:30)

Okay, thank you, Diana. Just want to show you the sort of intraday chart of the market here, and you can see the moment where the market fell as the stock market began to digest what President Trump had just posted on Truth Social. So the morning post on tariffs, so he's still talking about drugs, he says they're pouring into our country from Mexico and Canada, very high and unacceptable levels. And then he goes through some of the timeline here of when tariffs are going to go into effect. On Mexico and Canada, he says we can not allow this scourge to continue to harm the US. Therefore, until it stops or is seriously limited, the proposed tariff schedule to go into effect on March 4th will indeed go into effect as scheduled. He also adds China will likewise be charged an additional 10% tariff on that date. And then he adds the April 2nd reciprocal tariff date will remain in full force and effect. Thank you for your attention to this matter. God bless America. The upshot, we're going to get an extra 10% tariff on China.