Dow tumbled 241, decliners over advancers 3-2 & NAZ sank 241 (going deeper into correction territory). The MLP index did little at 250 & the REIT index rose 4+ to the 352s. Junk bond funds inched higher & Treasuries were a tad higher. Oil fell to the 55s & gold added 1 to 1224.
AMJ (Alerian MLP Index tracking fund)
Stocks lower following weekly loss
Rising mortgage rates and continued home price growth are hurting affordability & fast becoming a toxic cocktail for the nation's homebuilders. Sentiment among homebuilders dropped 8 points in Nov to 60 in the National Association of Home Builders/Wells Fargo Housing Market Index. That is the lowest reading since Aug 2016, but anything above 50 is still considered positive. The index stood at 69 in No of last year and hit a cyclical high of 74 last Dec. “Builders report that they continue to see signs of consumer demand for new homes but that customers are taking a pause due to concerns over rising interest rates and home prices,” said NAHB Chairman Randy Noel. Of the 3 components, current sales conditions fell 7 points to 67, sales expectations in the next & months dropped 10 points to 65 & buyer traffic registered an 8-point drop to 45. Buyer traffic had broken out of negative territory earlier this year but now appears to be back in it solidly. Some of the nation’s largest publicly traded homebuilders havelowered their expectations for sales in 2019 in recent earnings releases. There is still a shortage of homes for sale, but newly built homes come at a price premium, & as interest rates rise, new home buyers are consequently hit hardest. The average rate on the popular 30-year fixed mortgage is now more than a full percentage point higher than it was a year ago. The huge home price gains seen over the last two years are now shrinking, but prices were still up a strong 5.6% year over year in Sep. “For the past several years, shortages of labor and lots along with rising regulatory costs have led to a slow recovery in single-family construction,” said the NAHB's chief economist, Robert Dietz. “While home price growth accommodated increasing construction costs during this period, rising mortgage interest rates in recent months coupled with the cumulative run-up in pricing has caused housing demand to stall.”
Homebuilder confidence plummets to the lowest level in more than two years as 'demand stalls'
Shares of Apple (AAPL), a Dow & NAZ stock, fell after a report said the tech giant has cut down on iPhone production orders. It was reported that AAPL has slashed orders for the iPhone XR, XS & XS Max models, the 3 models were unveiled in Sep. AAPL told its suppliers it planned to slash production of the XR by 1/3 of the approximately 70M units it had asked them to build between Sep & Feb. It added that in the past week the company told suppliers it plans to trim production of the XR again. The tech giant’s stock has been under pressured lately. Last week, it dipped into correction territory, down 20% from an all-time high that brought its market cap to more than $1T. Lumentum (LIKE), a supplier of laser technology used in the FaceID, cut its outlook citing a reduced shipment from a major customer. Several analysts have downgraded the stock recently or lowered their 12-month price targets amid fears that iPhone sales will slow down moving forward. The stock fell 5+ to 188.
If you would like to learn more about AAPL, click on this link:
club.ino.com/trend/analysis/stock/AAPL?a_aid=CDXXX&a_bid=6ae5b6f7
Apple shares fall on report of slashed iPhone production orders
After the US and China's weekend clash, all eyes shift to Trump and Xi's next meeting
Sellers are back with a lack of encouraging news about the economy. This will be a short week for trading, typically a time for limited price moves. Of course, these days wild swings can be expected at any time. The Dow is still near the important 25K resistance level.
Dow Jones Industrials
AMJ (Alerian MLP Index tracking fund)
| CL=F | Crude Oil | 55.16 | -1.30 | -2.3% |
| GC=F | Gold | 1,222.40 | -0.60 | -0.1% |
Stocks opened lower, in what will be a holiday-shortened trading week with retail squarely in focus. US markets will be closed on Thurs for Thanksgiving Day & some markets will close early on Fri. This week, retail stocks reporting earnings will be combined with Black Friday marking the unofficial start of the Christmas shopping season. Oil was lower again today, continuing its recent losing streak. The S&P 500 edged higher Fri, but steep losses from earlier in the week pushed the broad index to its first weekly loss of Nov. Fears
that business growth is slowing & the US economy is headed for a
rockier road in 2019 were heightened after several more companies. The S&P 500
added 6 (0.2%) to 2736 on Fri, while the Dow added 123 (0.5%) to
25,413, finishing the week down 2.2%. The NAZ
declined 11 (0.2%) to 7247 putting it deeper
into correction territory.
Stocks lower following weekly loss
Rising mortgage rates and continued home price growth are hurting affordability & fast becoming a toxic cocktail for the nation's homebuilders. Sentiment among homebuilders dropped 8 points in Nov to 60 in the National Association of Home Builders/Wells Fargo Housing Market Index. That is the lowest reading since Aug 2016, but anything above 50 is still considered positive. The index stood at 69 in No of last year and hit a cyclical high of 74 last Dec. “Builders report that they continue to see signs of consumer demand for new homes but that customers are taking a pause due to concerns over rising interest rates and home prices,” said NAHB Chairman Randy Noel. Of the 3 components, current sales conditions fell 7 points to 67, sales expectations in the next & months dropped 10 points to 65 & buyer traffic registered an 8-point drop to 45. Buyer traffic had broken out of negative territory earlier this year but now appears to be back in it solidly. Some of the nation’s largest publicly traded homebuilders havelowered their expectations for sales in 2019 in recent earnings releases. There is still a shortage of homes for sale, but newly built homes come at a price premium, & as interest rates rise, new home buyers are consequently hit hardest. The average rate on the popular 30-year fixed mortgage is now more than a full percentage point higher than it was a year ago. The huge home price gains seen over the last two years are now shrinking, but prices were still up a strong 5.6% year over year in Sep. “For the past several years, shortages of labor and lots along with rising regulatory costs have led to a slow recovery in single-family construction,” said the NAHB's chief economist, Robert Dietz. “While home price growth accommodated increasing construction costs during this period, rising mortgage interest rates in recent months coupled with the cumulative run-up in pricing has caused housing demand to stall.”
Homebuilder confidence plummets to the lowest level in more than two years as 'demand stalls'
Shares of Apple (AAPL), a Dow & NAZ stock, fell after a report said the tech giant has cut down on iPhone production orders. It was reported that AAPL has slashed orders for the iPhone XR, XS & XS Max models, the 3 models were unveiled in Sep. AAPL told its suppliers it planned to slash production of the XR by 1/3 of the approximately 70M units it had asked them to build between Sep & Feb. It added that in the past week the company told suppliers it plans to trim production of the XR again. The tech giant’s stock has been under pressured lately. Last week, it dipped into correction territory, down 20% from an all-time high that brought its market cap to more than $1T. Lumentum (LIKE), a supplier of laser technology used in the FaceID, cut its outlook citing a reduced shipment from a major customer. Several analysts have downgraded the stock recently or lowered their 12-month price targets amid fears that iPhone sales will slow down moving forward. The stock fell 5+ to 188.
If you would like to learn more about AAPL, click on this link:
club.ino.com/trend/analysis/stock/AAPL?a_aid=CDXXX&a_bid=6ae5b6f7
Apple shares fall on report of slashed iPhone production orders
Investors & world leaders alike will be glued to the upcoming meeting between Pres Trump & Chinese Pres Xi Jinping in Argentina, hoping for clues to what's next. Trump criticized Mexico & Canada for months, claiming they took advantage of US companies thru trade, but the 3 countries reached replace the North American Free Trade Agreement. The approach to China has been different. Trump has repeatedly attacked the
country for stealing intellectual property, creating barriers to
American companies that try to operate in China & for the massive
trade imbalance between the 2 countries. Differences between the big economies were on full
display at the Asia-Pacific Economic Cooperation (APEC) summit over the
weekend, resulting in the group's failure to agree on a joint communique for the first time in its history. In Buenos Aires,
the Trump & Xi are expected to meet each other with trade high on
their agenda. Tensions between the 2 countries have dominated economic
headlines this year, with both sides imposing tit-for-tat tariffs on
each other's products. The trade fight has resulted in the IMF downgrading its global growth outlook for this year & next.
After the US and China's weekend clash, all eyes shift to Trump and Xi's next meeting
Sellers are back with a lack of encouraging news about the economy. This will be a short week for trading, typically a time for limited price moves. Of course, these days wild swings can be expected at any time. The Dow is still near the important 25K resistance level.
Dow Jones Industrials
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