ONE-TWENTY TWO: Trading Financial Markets
Since the year 2000, delivering a different narrative for students and fans of financial markets: stocks, options, currencies, Bitcoin, and more…
Housing Market Intro and Summary Despite more evidence of slowing conditions in the housing market, home builder stocks remained relatively resilient in August. The underlying dynamics of demand remain in place even as housing prices remain lofty and continue to conjure up images of a housing bubble for market commentators and pundits. A supportive Federal … Read more
Housing Market Intro and Summary “When will the housing market crash?” I hear this question from people astounded by the housing market’s strong performance during the pandemic. The housing market is not heading into a crash anytime soon. Demand remains strong, inventories are scarce, mortgage rates are rock bottom, home buyers are in strong financial … Read more
Housing Market Intro and Summary The Spring selling season looked like it started strong for new home sales. The data for April reveal a story evolving differently. Absolute inventories rose for both existing and new homes and yet sales declined. Housing starts also suffered a setback. Median prices of homes soared, especially for new homes, … Read more
Housing Market Intro and Summary In March, home builder stocks pushed through softening housing data thanks in large part to builder-specific catalysts. In April, a series of strong earnings reports and a healthy rebound in the new homes market combined to propel most housing-related stocks higher still. The contrast between existing and new homes stood … Read more
Housing Market Intro and Summary Softening housing data pointed to more normalization in the housing market. Normalization is returning housing data to prior trends and in some cases suggesting important plateaus. Home builder stocks powered through the softening data to show strength in sharp rebounds and fresh all-time highs. The arrival of the Spring selling … Read more
Just as I was going about to close the books on the seasonal trade in home builders, Lennar (LEN) revived upward momentum across home builders. LEN gained 13.8% after announcing a partnership with Centerbridge to invest in rental single-family housing. News of the “Upward America Venture” lit a fire across the sector. However, the excitement … Read more
Mortgage rates are on the rise following record high lumber prices. Together, these measures are starting to weigh on the stocks of home builders. 30-Year Mortgage Rate The 30-Year fixed rate mortgage average in the United States hit 2.97% on Thursday, February 25th. Not only is this rate a 6-month high, but also the rise … Read more
Housing Market Intro and Summary The housing downturn ended almost as quickly as it began. V-shaped recoveries are evident across a spectrum of data, especially in home builder sentiment and new home sales. Home builders continue to describe extremely strong demand that, in many cases, goes beyond the release of buying power pent-up by the … Read more
The Housing Market Index (HMI) soared to 72 in July. The 14-point move completed a V-shaped recovery in the sentiment of home builders. Unlike the reaction to the surprisingly strong June HMI, the reaction to July’s surprise was definitely positive. The Message in Home Builder Sentiment The National Association of Home Builders (NAHB) explained the … Read more
Housing Market Intro and Summary Something surprising is happening in the middle of the current downturn in the housing market: buyers keep coming and home builders are staying resilient and resolute. A series of earnings reports from publicly traded home builders do not reflect the historic plunge in builder sentiment from April (see below). The … Read more