Hotter PPI, Tech's Rough Stretch, Biden: China a "Ticking Time Bomb" 8/11/23

Squawk on the Street

CNBC

News, Business, Investing

4.1 • 567 Ratings

🗓️ 11 August 2023

⏱️ 44 minutes

🔗️ Recording | iTunes | RSS

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Summary

Carl Quintanilla, Sara Eisen and Mike Santoli led off the show with market reaction to fresh inflation data: The July Producer Price Index came in a bit hotter-than-expected, following Thursday's cooler-than-expected CPI report. The anchors explored what's at stake for the markets and the Fed. Also in focus: The tech sector's roughest stretch since December, President Biden calledChina a "ticking time bomb" due to its economic challenges, getting ahead of the curve on next week's retail earnings from Walmart, Target and Home Depot, what X Corp. CEO Linda Yaccarino told Sara about a potential Musk-Zuckerberg cage match. Squawk on the Street Disclaimer

Transcript

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0:00.0	It's Jim Kramer here. You're listening to the opening bell of CBC Squawk on the Street. Don't miss a minute of the action.
0:07.4	Good Friday morning. Welcome to Squawk on the Street. I'm Carl Kintanier with Sarah Eisen, Mike Santoli, post-9 of the New York Stock Exchange. Jim and David have the morning off.
0:14.6	Pre-market's not thrilled with that macro data today. UK GDP runs hot. Then our own July producer prices run warm. Highest annual headlines since May
0:23.3	bonds under pressure yet again. Our roadmap's going to begin with a slightly hotter than expected
0:27.4	July PPI. And what it could mean for markets in the Fed? Also ahead, the tech sector in the midst of its
0:33.0	worst stretch since December. Will the pullback be short-lived? And President Biden speaking out about
0:38.8	China's economic challenges, calling the country a, quote, ticking time bomb. Let's begin with the markets,
0:45.0	though, on this final trading day of the week as investors digest today's PPI number. Interesting,
0:50.7	Sarah. I mean, one-tenth is not that dramatic. We had a negative revision, but coming
0:55.5	off of the stellar reception to CPI yesterday, maybe it looks a little bit worse?
1:00.0	Yeah, after a zero percent in June, you don't want to see a pack tick up to 0.3% in July,
1:05.8	which is what we got. And we know producer prices or wholesale prices that feed in.
1:10.6	So maybe a little de-emphasized because we already got the CPI read, but you just don't want to say.
1:16.4	Traders, investors are on guard for inflation to hook back up, right?
1:21.5	Like we hope, you know, people are hoping that the inflation data, which has shown moderate
1:26.5	inflation and has been celebrated as good news,
1:28.8	will take us down to the 2% target and the Fed's work is done. But there's a chance that,
1:34.6	look, it could be sticky. We still see a really tight labor market where wages are rising.
1:39.7	We see oil prices rising to year-to-date highs. That's going to matter to the headline number.
1:44.5	And we see signs, including in this number, Mike, of the PPI, where services are still problematic.
1:50.5	I mean, services inflation jumped 0.5% month over month in this PPI data. That's a 2.5% year-over-year
1:56.9	increase. It's driven by trade and transportation and warehousing. So the disinflation,
	...

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