Coffee really does taste better on Fridays. But if you're in the housing market right now it's probably hard to swallow every day of the week. Mortgage applications have cratered, and business is cooling after a historic boom.
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I'm Phil Rosen, and today we're breaking down the housing market.
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1. Mortgage demand is at its lowest point in 22 years. Over the last week, mortgage applications fell 7%, and they're down 21% since last June.
A traditional 30-year fixed mortgage saw average interest rates rise to 5.4% last week, compared to rates in the low 3% range around this time last year.
Pantheon's chief economist Ian Shepherdson said the sharp drop in applications is likely to continue, given that interest rates are set to rise further. This could be a silver lining for buyers who've been locked out of the market by the dual headwinds of stubbornly high prices and higher mortgage rates.
And weakness in housing begets weakness in lumber. Prices for the key building commodity dropped another 4% Wednesday to hit their lowest level in nine months. Builders have pulled back on new housing starts as they see inventories across the country rising.
Prices have slipped in nine of the last 11 weeks, and the strength in mortgage rates has moved inversely with weakness in lumber.
Lumber prices are down 50% this year, and have plunged 67% from their record-high reached last May of around $1,700 per thousand board feet.
3. On deck today: North Bud Farms, YourWay Cannabis Brands, and Mimi's Rock Corp, all reporting. Plus, the latest consumer price index inflation print for May is due at 8.30 a.m. ET.
4. A UBS strategy head who warned about high inflation and slowing growth last June gave his top investing ideas. There's only a 12% chance of a recession, according to Keith Parker. But these four investments are strong bets right now.
5. Russian oil and gas exports helped the Kremlin add $9.5 billion to an emergency fund. According to a Reuters report, bailouts are piling up amid Western sanctions and Russia is looking to shore up its defenses. Here's what you want to know.
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6. US stocks are primed for a dramatic move in either direction as investors look to the inflation report. "The S&P 500 remains wound up in a tight intraday trading range, which has the potential to be resolved in dramatic fashion," Fairlead's top analyst said. These are the key levels to monitor.
8. Goldman Sachs' star economist laid out whether the US is heading for a recession. He also broke down what could possibly trigger a rebound in the floundering stock market after the crash. See what he said here.
10. ExxonMobil stock has soared 157% since the Dow Jones Industrial Average kicked it out two years ago. And it replaced the oil giant with Salesforce — which has slumped 30% since then.
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