CNBC Business News Update - Market Midday: Stocks Turn Higher, Moody's Downgrades US Credit Worthiness, Tariffs Could Cause Job Cuts 5/19/25

Episode Date: May 19, 2025

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. Wall Street has turned higher this afternoon. Major averages all in the green. The Dow is up 167 points, four-tenths of a percent now being led higher by shares of United Health, which are recovering. They're up almost 8 percent. The S&P 500 index up nine, the NASDAQ up 11. Nvidia has turned slightly higher this afternoon.

Companies whose shares have hit fresh all-time highs today include TJ Maxx and Marshall's parent TJX Companies, Monster Beverage, MasterCard, Visa and Cardinal Health. The U.S. had its credit rating downgraded over the weekend by Moody's, the final of the big three credit rating agencies to do so. It's worried about the US deficit as lawmakers work on a tax bill in Washington. As I look at the Moody's downgrade,

a lot of this comes down to that cost that I talked about being the most expensive bill. I think after the election, most people anticipated the extension of the Trump tax cuts to be about a $1.5 trillion expense. We're talking something in the $5, $6, $7 trillion.

And a lot of these tax provisions are front-end loaded. They are supercharging fiscal stimulus here, and the cuts are back-end loaded. So the actual cost of this bill could be even higher. Raymond James, Washington policy analyst analyst Ed Mills on CNBC. Treasury Secretary Scott Besson had this to say about Moody's on NBC News Meet the Press. I think that Moody's is a lagging indicator. I think that's what everyone thinks of credit agencies. Besson also acknowledged that tariffs may raise prices at retailers, including Walmart. While President Trump posted over the weekend that Walmart should eat the tariff cost.

Besant said he spoke to Walmart's CEO over the weekend and concluded the world's largest retailer would eat some of the tariffs, although that means consumers will still see some higher prices. Conceivably, you're going to be getting a tax cut, seen as positive. To the chagrin of Moody's. To the chagrin of Moody's and our overall budget deficit. Only the rich will get tax cuts and they don't. They don't shop at Walmart.

Well you do and you're rich. I love Walmart. Yeah. I think Walmart offers great prices. I know. Why wouldn't you? Well I mean like anyone who's actually been to Walmart and I don't know how much time the president spent at Walmart would realize very quickly that wow this place is so much

cheaper than everywhere else. CNBC's Jim Cramer, Carl Quintanilla, and David Faber. Here's what businesses are telling CNBC. If you've got corporates absorbing the tariff impact, it's not like that is something that happens in a vacuum. If they're forced to absorb the cost and it becomes too much of an issue, then we could be looking at job cuts down the line.

I think the ultimate economic direction of the US is gonna come down to the labor market and whether we do start to see companies shedding jobs to protect margins. That's CNBC Europe's Juliana title bomb. Bitcoin briefly hit a high of 107,000, its highest since the end of January, although it's pulled back a little today. Crypto exchange Coinbase in the S&P 500 today replacing Discover, which was bought by Capital One. Warner Brothers' horror film Final Destination Bloodlines won the weekend box office.

Jessica Edinger, CNBC.