SOTS 2nd Hour: Veteran Investor Dan Niles, The Chips Playbook (Nvidia & Intel), and Keurig Brews a New Deal 8/25/25

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Carl Quintanilla (1:08)

Good Monday morning, welcome to Squawk on the Street. I'm Carl Quintanilla with Mike Santoli, David Faber, live at Post 9 of the New York Stock Exchange. Sarah Eisen has the morning off. A little bit of selling this morning to start another busy week. Indices are red, fairly broad-based. Most sectors are red. Comm service is the only one that's meaningfully higher. Yield's not really cooperating as the 10-year tries to get closer once again to 4-3. Today, Did Pal will give the all-clear to stocks on Friday. We'll talk about that this morning. In just moments, veteran investor Dan Niles will give us his playbook going into year-end. Plus, it's not just Intel. The White House now says the government could take stakes in more companies. We'll look at what that might mean for investors. And this new deal buzzed this morning with Keurig Dr Pepper buying the owner of Peet's Coffee for $18 billion. We'll tell you what it means for competition in the coffee space.

David Faber (1:54)

First, though, let's get some new housing data that has just been crossing. Diane Ollick has that for us, Diana.

Diana Olick (2:00)

Well, David, new home sales in July came in at a seasonally adjusted annualized rate of 652,000 units. That is a beat. The street was expecting 632 It is still down 0.6% month to month and down 8.2% year over year. Why? Because June's number was revised up to 656 from 627 So you saw a stronger June than we thought. Now, this number is based on signed contracts during the month of July. So people out shopping, inking their deals. And that's when mortgage rates were still on the higher level above 6.75% on the 30 year fix. They have since come down considerably, but that didn't happen until the first week of August. So that's not represented in these numbers. Now the median price of a new home sold was $403,800.

That is down 5.9% year over year. So you see the builders lowering prices. Of course, we know the builders, the big publics have been buying down mortgage rates. We did see in the Builders Sentiment Report for August that they started to see a little more buyer traffic. So that combined with lower rates might help in August. But we did also see the supply come down to a 9.2 per month supply. That's down from a 9.8 month supply. So supply coming down is better. We need a balanced market. But again, so sales lower, but better than expected. So it's kind of a strange report. Back to you.

Carl Quintanilla (3:19)

Thank you, Dan. Diana, thanks, Diana. Well, like, meantime, watching the reaction, the follow through to Friday's move, where we saw obviously Mike, the small caps do quite well on these renewed hopes that September's a go on a cut.

Michael Santoli (3:32)

Exactly. Not really giving back much of that gain. Obviously the small cap Russell 2000 is up close to 4%.

It's been, it was a fascinating response. I mean, I think on one level completely lines up with the way the playbook would tell you in terms of getting a cut or indications of a cut that was not fully anticipated. I think there was a rational and plausible case that Powell would be kind of neutral and non-committal more than he was. And so you didn't have the market priced fully for the idea that we're going to get a rate cut into a still relatively stable economy with financial conditions very loose markets at their highs, valuations fall, all the other things in the litany, credit spreads tight, where it doesn't seem like the economy needs the help. So the market did celebrate that. 90% of all volume to the upside of the New York Stock Exchange on Friday. It's a rare thing. It's a more rare thing when you're near a high. That's usually the kind of thing where you see, you know, roaring out of a correction or out of a growth scare for the economy. And what does that mean? Does it mean that the market is pretending we're early in something, when we're not really all that early in terms of the economic expansion, or is it just bullish? Because usually the forward implications of that are pretty bullish. It's also a global rally, non-U.S. stocks doing well. And even you would look to the bond market to say, you know, maybe they're going to throw some cold water on this, to say that cutting in September, if we get that, it's going to be a mistake, and it's going to flare up inflation expectations. You're not really getting that. Now, the long end is not coming down, but it's definitely not necessarily immediately saying, we need to ramp our inflation.