SOTS 2nd Hour: Venture Global IPO, CSX CEO, and Boeing’s Big Warning 1/24/25

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Carl Quintanilla (0:52)

Good Friday morning, welcome to another hour of Squawk on the Street. I'm Carl Quintanilla with Leslie Picker and David Faber here at Post 9 of the New York Stock Exchange. Sarah Heisen has the morning off. Got some all time highs once again on the S&P at 61.26. Yields coming down a bit at the short end on a surprisingly soft services PMI a moment ago. We'll talk about that in a moment. Plus a big interview in just a moment as well. The CEO of Energy Group Venture Global's with us, going public at the big board and one of the biggest energy IPOs in a decade.

Leslie Picker (1:22)

This Friday, we are 30 minutes into the trading session. Here are three big movers we are watching. American Express under pressure despite beating estimates reporting record card member spending and raising its dividend. That said, the stock has been a big outperformer over the last year and shares are down about 3.2 percent this morning. Verizon also beating estimates higher prices for its plans helping boost revenue. The company adding nearly a million subscribers across mobile and broadband. The street likes what it sees, stock up one and a quarter percent. And shares of Nova Nordis popping higher after the pharma giant reported positive early stage results for its once weekly obesity drug. Those shares currently up about 7.5 percent.

David Faber (2:02)

We got some economic data just crossing the tape. Rick Santoli has it for us. Rick.

Rick Santelli (2:07)

Yes, and there's more weakness here. Now, these are the January final read on University of Michigan sentiment. The mid-month read on the headline number was 73.2. It moves down to 71.1.

That's a big, big move, usually, for a two-week look. And that is the weakest level since October of last year. If you look at current conditions, very similar. It's also less than the 77.9 mid-month read at 74 That's the weakest since November of last year. Finally, expectations, same scenario. 70.2 mid-month final read, 69.3. That is the weakest going back to July of last year. Now, let's look at the inflation numbers. 3.3 was mid-month on one year. It remains at 3.3. 3.3 is the highest since November of 23 Finally, the 5-10 year inflation actually moved down. It was somewhat expected, but a little bit surprising nonetheless. 3.3 was our mid-month read, moves to 3.2. 3.2 would be the smallest amount, or I guess however you looked at it. That's the highest level actually going back to April of 21 The last read we had in December was 3%. And our December existing home sales, a little bit better than expected. 4.24 million seasonally adjusted annualized units, and that is up a couple of percent from last month's 4.15 million seasonally adjusted annualized units. We see right now that 10s hovering at 464 It's basically unchanged on the day, up two on the week. Yield curve has steepened because at 4.25, you're down four basis points on the week on a two-year note. Carl, back to you.

Carl Quintanilla (3:52)

All right, Rick, valuable information. Rick Santelli, thanks. Meantime, as we mentioned at the top of the hour, a fresh record high at the open today. Nasdaq's getting a little bit closer to a record high. And now Mike Santoli, we got these softer PMIs and this touch lower on Umich as well.

Michael Santoli (4:07)

Yeah, Carl. And so that's a little bit of a test because we did come into this year with, I think, one of the hurdles being high expectations for both the economy and earnings. So far, so good. I mean, I don't think anybody is thinking that these numbers are make or break, but definitely raise the possibility that the 3% real GDP pace that we seem to have exited 2024 at, put into the Atlanta Fed, maybe we're going to be in for a little bit of a rethink or moderation. However, so far, year to date, it's been actually kind of a pretty inclusive rally. You have small caps, the NASDAQ and the S&P 500, all up almost the same 4%. The majority of stocks had a very tough December. We reset sentiment lower, and I think you're benefiting this week from, essentially, the lower hurdle that's implied by those stocks having pulled back and they're picking up again. I do think it's interesting that we're back at a new high in the S&P 500, the first one since December 6th, and the 10-year treasury yield is a half percentage point higher right now than it was on December 6th. It was about 415 back then. Now, we're higher on the S&P 500 by a little bit, and you're up a half a point in yields. That is exactly the pattern we've seen over recent years, which is a shoot higher in yields creates a little bit of a scare, creates this test of whether the economy can handle it, stocks back off a little bit, and then as yields stop going up, they don't become unanchored completely and stop short of some critical levels and you're able to get the relief rally and then you make your peace with where yields are. I just want to mention one other thing in terms of expectations and public excitement for the stock market. Look at the chart of Robinhood, obviously the most levered stock to broad investor, retail investor activity. You see this is just a six month chart. Now Goldman's had a great six months, up 30%.