CNBC Business News Update - Markets Midday: Stocks Slip, US Service Sector Activity Weaker Than Expected, President Trump Narrows Fed Chair Candidates To Four

Episode Date: August 5, 2025

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

I'm Peter Shack now, CNBC. Stocks are giving back some of yesterday's big gains with economic concerns sparked by a weaker than expected reading for the U.S. services economy. The Dow falling 94 points at 44,079, the S&P 500 giving up a half percent or 30 points, and the NASDAQ is down 119 points or 6 tenths of 1%. The monthly index from the Institute for Supply Management came in at 50.1. Economists have, expected a reading of 51.2. The July number is still barely over the 50 mark, which is the dividing line between growth and contraction for that sector. President Trump tells CNBC he's narrowed his candidates for Fed Chair down to four people, although that list does not include Treasury Secretary Scott Besant, who wants to remain in his current job. Jerome Powell's term

as Fed Chair expires next May. One of today's winners in the down market is data analytics firm Palantir, which increased its annual revenue forecast on strong demand for its AI-powered tools. It's up about 6% today and up nearly seven-fold from a year ago. Mizzouho's senior enterprise software analyst Greg Moskowitz says the biggest worry about Palantir is its stock's lofty valuation. Compared them to the next highest multiple stock, which is Cloudflare, Palantir is trading at a 3x premium to that company. So we love what Palantir is doing.

Again, they're executing better than anyone, in my view, right now with some software. But obviously, there is a price and what is the company worth. And so that is the challenge from here as well. Palantir has hit an all-time high today, and there's no shortage of other well-known stocks doing the same, despite the drop in the major averages. Among them, DoorDash, Tapestry, Northrop Grumman, AutoZone, and O'Reilly Automotive. The New York Fed says total household debt levels rose 1% during the second quarter, in part from a growing number of student loan borrowers.

That category was also higher than others in terms of delinquencies with about 10.2% of student borrowing 90 days or more delinquent. Peter Schack now, CNBC. Introducing CNBC Plus, the new streaming platform from the number one source in business news. Watch live or on demand. Access any market, any time, anywhere. Start streaming. Go to CNBC.com slash plus now.