CNBC Business News Update - Market Close: Stocks Plunge, Dow On Longest Losing Streak In 50 Years, Fed Cuts Rates And Forecasts Fewer Cuts For 2025 12/18/24

Episode Date: December 18, 2024

From Wall Street to Main Street, the latest on the markets and what it means for your money. Updated regularly on weekdays, featuring CNBC expert analysis and sound from top business newsmakers. Anchored by CNBC's Jessica Ettinger.

I'm Jessica Edinger. CNBC, a Wednesday bloodbath for stocks on Wall Street. The Dow tanked more than 1,100 points, induced by the Fed, which cut interest rates by a quarter percentage point, as expected. But stocks tanked because the Fed's forecasting fewer rate cuts next year, and investors did not want to hear that. All the round numbers are gone. 6,000 S&P, 45,000 Dow, 20,000 composite. This could be your flush. This could be where you finally have people lose a little bit of their hope. So we're going to reset. CNBC's Mike Santoli. The Dow's losing streak. Now its longest since 1974 at 10 days.

The Dow was down 1,123 points, 2.5% led lower by shares of Amazon, which tanked 4.5%. The S&P 500 index down 178 points, that was 3%. The Nasdaq plunged 716 points, 3.5%. I think now you should be increasing cash because the yield on cash appears not to be going away. I would actually hold about 30 percent in cash right now because you're not giving up much yield versus other assets that have volatility and risk. That's Double Line's Jeffrey Gundlach on CNBC. Only a handful of companies' shares hit record highs Wednesday, including Visa. The Supreme Court will hear arguments over the TikTok divestment law.

The court did not pause the law, which calls for the social media platform to be sold off by its Chinese parent company or to be banned, either one, in mid-January. The 5% mortgage rates that people want, they're at least two years away. And the CEO of Compass says, brace yourself for still higher home prices because there's just not enough homes up for sale. Yes, the inventory right now has been increasing across the country. Every state has more inventory than it did this time last year. So that's a positive. But it's 20% less than pre-pandemic levels. If we want to see prices stabilize or even come down, we'll need much more inventory. Compass CEO Robert Refkin on CNBC.

Home builders overall started building fewer homes in November, but there's a split. They started construction on fewer apartment buildings, but started construction on a few more single-family homes. The driver down on the miss was multifamily and starts down 24 percent month to month. Single-family starts were actually up 6.4 percent month to month, still down over 10 percent year over year. So builders, they're waiting to see what happens after the new

administration takes power and what happens with regulation, what happens with mortgage rates. CNBC's Diana Olick, Wednesday's rate on a 30-year fixed home loan, 6.9 percent. According to Mortgage News Daily, back in September, it was 6.1. Traveling north for the holidays, your American dollar will buy you even more in Canada right now. The Canadian dollar hovering at its lowest level against the U.S. dollar since March of 2020. This is the government of Canadian Prime Minister Justin Trudeau faces a political crisis following the sudden resignation of his finance minister. CNBC's Frank Holland, one U.S. dollar now worth more than $1.40 Canadian. Conversely, it's pretty expensive now

for Canadians traveling to the U.S. On Thursday's watch list, we get the latest read on U.S. economic growth. The GDP numbers will be out, gross domestic product. We get the latest read on U.S. economic growth. The GDP numbers will be out. Gross domestic product. We get earnings from CarMax, Accenture, Olive Garden, Parent Darden Restaurants, FedEx, and Nike. And Taco Bell officially debuts chicken nuggets nationwide for a limited time. Jessica Ettinger, CNBC. Get tomorrow's big stock stories delivered to your inbox tonight when you subscribe to Stocks at Night, a free investing newsletter from CNBC. Sign up now at CNBC.com slash Stocks at Night.