Dow gained 197 from buying in the last hour, advancers over decliners 4-3 & NAZ rose 86. The MLP index went up to the 217s & the REIT index was off 1+ to the 399s. Junk bond funds continued lower & Treasuries saw more selling taking the yield on the 10 year Treasury to almost 3½%. Oil went up in the 85s & gold lost 4, falling to 1679 (more on both below).
AMJ (Alerian MLP Index tracking fund)
![Live 24 hours gold chart [Kitco Inc.]](https://www.kitco.com/images/live/gold.gif?0.2180338269244485)
More builders are lowering prices for homes as their confidence in the market continues to tumble. Homebuilder sentiment in Sep fell 3 points to 46 in the National Association of Home Builders/Wells Fargo Housing Market Index (NAHB). Anything below 50 is considered negative. That is the 9th straight month of declines & the lowest level since 2014, with the exception of a short-lived drop at the start of the coronavirus pandemic in 2020. Sentiment was at 83 in Jan of this year, when interest rates were about ½ of what they are now. Builders blame rising rates for their falling sentiment. The average on the 30-year fixed started this year around 3% & then began rising steadily, crossing 6% for a few days in Jun, according to Mortgage News Daily. It then fell back a bit & almost hit 5% in Aug, before rising sharply again, back over 6% this month. That made an already pricey housing market even less affordable. The Federal Reserve, meanwhile, is expected to again raise its benchmark rate this week as inflation remains high. “Buyer traffic is weak in many markets as more consumers remain on the sidelines due to high mortgage rates and home prices that are putting a new home purchase out of financial reach for many households,” said NAHB Chair Jerry Konter. Nearly a qtr of homebuilders also reported lowering home prices, up from 19% in Aug, Konter added. Of the index's 3 components, current sales conditions dropped 3 points to 54, sales expectations in the next 6 months fell 1 point to 46 & buyer traffic declined 1 point to 31. Builders continue to report elevated construction costs, in addition to higher interest rates weighing on their market. Higher costs for land, labor & materials have made it harder for builders to lower prices, but they are now being forced to. “In this soft market, more than half of the builders in our survey reported using incentives to bolster sales, including mortgage rate buydowns, free amenities and price reductions,” said Robert Dietz, chief economist at the NAHB.
More homebuilders lower prices as sentiment falls for ninth straight month
The Defense Dept (DOD) is pushing its contractors to ensure none
of their materials are being sourced from China or other US
adversaries. The effort comes weeks after the Pentagon paused deliveries of new F-35 fighter jets upon discovery that a component in the craft had been manufactured using a China-sourced alloy. The
DOD is now turning to artificial intelligence to help track its
globe-spanning supply chain & limit input from adversaries. The
defense supply chain has been a focus in the US for years, with a
House task force pushing the military to sharpen its supply chain
security in 2021. Defense contractors are already held to a high
standard for sourcing their materials from the US or other trustworthy
sources. The component that caused the F-35 scare was a magnet used in
the aircraft's turbomachine pumps. The magnet was partially constructed
from a Chinese-sourced alloy. Officials said the issue did not affect F-35s that are already in service. "We have confirmed that the magnet does not transmit information or harm
the integrity of the aircraft," F-35 Joint Program Office a spokesperson said. The stock rose 2.10.
If you would like to learn more about LMT, click on this link:
club.ino.com/trend/analysis/stock/LMT?a_aid=CD3289&a_bid=6ae5b6f7
Pentagon doubles down on cutting off defense supplies from China after F-35 scare
Pres Biden said US forces would defend Taiwan in the event of a Chinese invasion, his most explicit statement on the issue, drawing an angry response from China that said it sent the wrong signal to those seeking an independent Taiwan. When asked whether US forces would defend the democratically governed island claimed by China, he replied: “Yes, if in fact, there was an unprecedented attack.” Asked to clarify if he meant that unlike in Ukraine, US forces - American men & women - would defend Taiwan in the event of a Chinese invasion, Biden replied: “Yes.” This is the latest time that Biden has appeared to go beyond long-standing stated US policy on Taiwan, but his statement was clearer than previous ones about committing US troops to the defend the island. The US has long stuck to a policy of “strategic ambiguity” & not making clear whether it would respond militarily to an attack on Taiwan. A White House spokesperson said US policy towards Taiwan had not changed. “The president has said this before, including in Tokyo earlier this year. He also made clear then that our Taiwan policy hasn’t changed. That remains true,” he added. Chinese foreign ministry spokeswoman Mao Ning told a regular briefing in Beijing that Biden's comments sent a “seriously wrong signal” to separatists forces for Taiwan independence. China was “strongly dissatisfied and resolutely opposed” to Biden's comments & had lodged a formal complaint over it, she said, warning that China reserves the right to take all necessary measures to counter separatism.
Biden says U.S. forces would defend Taiwan in the event of a Chinese invasion
Gold futures declined, giving back most of what they gained in the previous session, to hold ground near their lowest price since 2020, while the yield on the 10-year Treasury note climbed to its highest level in more than a decade. Gold futures for Dec fell $5 to settle at $1678 per ounce after gaining nearly 0.4% on Fri. Prices for the most-active contract had settled Thurs at $1677, the lowest since Apr 2020. Today saw a relatively quiet session with no major economic data releases in the US & no Federal Reserve officials set to speak publicly. Gold appears to have run out of downside momentum as the selloff over the past week has returned the yellow metal to its weakest level in 2 years. Another catalyst, such as a hawkish Fed on Wed, would likely be needed for gold prices to continue to soften. The yield on the 10-year Treasury note was up 2.6 basis points at 3.4749%, around its highest level in more than a decade. Rising yields can weigh on gold & other commodities, raising the opportunity cost of holding nonyielding assets.
Gold retreats, holds near a more than 2-year low as investors await Fed decision
Oil futures gave up early losses
to finish higher, with tight supplies returning to the spotlight,
providing support for prices. The market is waking up to realize that
distillate supplies are so tight that there's little room for any
disruptions, ahead of the winter heating season. WTI crude rose 62¢ (0.7%) to settle at $85.73 barrel.
Oil futures finish higher as tight supplies come back into focus
Dow Jones Industrials
No comments:
Post a Comment