Squawk on the Street 2nd Hour 5/14/26

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Sara Eisen (0:58)

Good Thursday morning.

Eunice Yun (0:59)

Welcome to Squawk on the Street.

Sara Eisen (1:01)

I'm Sara Eisen with Carl Quintanilla. We are live as always from Post 9 of the New York Stock Exchange, David Faber's on assignment. Coming up this hour, the big takeaway is from President Trump's meeting with China Xi, and what it means for your money. We'll head to Beijing for the latest. We'll have a huge day here for IPOs, Cerebris making its public debut at the NASDAQ, and Blackstone's Data Center REIT goes public here at the Big Board. We'll talk to the CEO of the Blackstone REIT in just a moment. We're also on the lookout for the Supreme Court opinions again today, as we await a potential decision on President Trump's authority to fire Fed Governor Lisa Cook. We'll bring you any headlines if we get them.

Carl Quintanilla (1:35)

Busy day for data between claims and retail sales, and now some business inventories once again with Rick Santelli.

Sara Eisen (1:40)

Hey Rick.

Rick Santelli (1:42)

Yes, and Carl, these are March numbers and keep in mind, conflict, all the issues that may still be lingering with tariffs, and business inventories jumped and they were expected to jump. The March reading was expected to be just shy of 1 percent, and it delivered up nine-tenths, and in the rear view mirror, we still have up four-tenths with no revision. Those are some of the strongest back-to-back numbers, going back probably to 2022 The up nine-tenths alone is the best since June of 2022, and it does really put a focus on the notion that inventories, at the beginning of the year, February was strong, March is strong. Many businesses want to get in front of any of the questionable issues. I mean, just look at this morning's import-export prices for April. Every metric was higher than expected. Every metric was sequentially higher than what we were looking at in the previous month. We see that interest rates are down from yesterday, and we're still within striking distance to that very psychological area of 4.5 and 10s below the market. Right around 4.37 is considered good yield support. Back to you.

Sara Eisen (2:52)

Okay, thank you, Rick. It is interesting to see Rick's yields stabilize in the face of some inflationary data.

The biggie that I'm focused on is retail sales. Just tells us a little bit how consumers are doing, and they're hanging in there. We got a 0.5 percent increase for the month of April.

That was a decent number. Of course, it wasn't as big as March's number. Keep in mind, these numbers aren't adjusted for inflation. The March number, which was huge, really reflected the height of the war, that high gas price and gas spending. Even the 0.5 number that we got today, I mean, you could say a lot of that could be inflation.

Carl Quintanilla (3:27)

Well, inflation adjusted, it's down to 10

Sara Eisen (3:29)

Right, because 0.6% inflation. So, but there was strength across, I think, nine of the categories, nine of 13 categories on retail sales showed increases. We saw weaker numbers at department stores, furniture stores, and clothing stores. The big gains, obviously gas stations, because we're paying more for gas, sporting goods, electronics and appliances, non-store retailers, food and beverage stores. Also, we saw increased spending at restaurants. If you do the control group, which feeds directly into GDP, it increased 0.5%, which was larger than expected, actually should make the GDP number look good. And Carl, what we see here is a split a little bit more towards staples, you know, necessities, people buying that. You see that during a little bit of periods of inflation and tougher times, and that jives with what we got from Bank of America on the spending growth data, they look at discretionary versus necessity spending, and you can see necessity is making up a bigger portion of spending in just in the month of April. I mean, they put this out before retail sales.