CNBC Business News Update - Markets Midday: A-I Concerns Push Stocks Lower, New Home Sales Jump Despite Rising Rates, Credit Card Delinquencies On The Rise, Fed Set To Meet

Episode Date: January 27, 2025

The latest in business, financial, and market news and how it impacts your money, reported by CNBC's Peter Schacknow.

I'm Peter Schach, now CNBC. Stocks are losing ground on concerns about the emergence of a China-based artificial intelligence company called DeepSeek and the claim that its app is cheaper and requires less data than its competitors. The Dow has just gone positive. It's up by two points at 44,427, but the S&P 500 is 1.8 percent lower at 108 points and the Nasdaq tumbling 3.1% or 613 points. It's taking the biggest hit due to the inclusion of many prominent AI stocks. NVIDIA, the stock at the forefront of the AI movement, has lost more than 16% in today's trading, its biggest one-day drop since March 2020. Similar sentiment has hit stocks of rival chip makers,

Broadcom and Marvell Technology, also both down about 16 percent. AT&T is the leading gainer in the S&P 500. It's jumping almost 6 percent on upbeat quarterly results. A new report from credit tracking firm VantageScore shows credit card delinquencies nearing a five-year high, and it's the high-end earners that are a big part of it, according to VantageScore shows credit card delinquencies nearing a five-year high, and it's the high-end earners that are a big part of it, according to VantageScore CEO Silvio Tavares. We've seen significant increases in services costs like home insurance, like auto insurance, and that is hitting the high-income consumer harder than most, and that's what's driving that delinquency rate.

Credit utilization actually decreased on a year-over-year basis. It was actually down about a full percentage point to about 51.6 percent credit utilization. Tavares says it's a positive sign that consumers are exercising self-control and are more credit cautious as we start the year. The Federal Reserve is set for its two-day policy meeting tomorrow and Wednesday. Most Fed watchers expect the central bank to keep rates unchanged, despite pressure from President Trump to lower them. Peter Schach now, CNBC. When you think of wealth, what do you see?

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