Dow jumped 284, advancers over decliners better than 2-1 & NAZ gained 188 to a new record. The MLP index added 4+ to the 174s & the REIT index was steady in the 465s. Junk bond funds were mixed & Treasuries edged higher. Oil shot up 3+ to the 65s & gold gained 21 ti 1805.
AMJ (Alerian MLP index tracking fund)
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As an intl crisis rages in Afghanistan – stemming from Pres Biden's disjointed Afghanistan pullout that's left many Americans stranded in Taliban territory – back home the House is set to vote on Dems' $3.5T budget resolution. The vote is planned for tomorrow. But the major piece of Biden's domestic agenda also faces a somewhat easier procedural hurdle today. The budget resolution will allow Senate Dems to bypass a GOP filibuster & advance a massive spending bill later this fall. But there's just one problem: Dems as of today don't appear to have the votes to pass it. "Time kills deals," the moderates, led by Rep Josh Gottheimer said in the op-ed. "This is an old business saying and the essence of why we are pushing to get the bipartisan infrastructure bill through Congress and immediately to President Biden’s desk — as the president himself requested the day after it passed the Senate." The group of 9 moderate Dems who said earlier this month they won't support a budget resolution until the House passes the Senate's bipartisan infrastructure bill appeared to double down in an op-ed yesterday. Now with just hours left until the House is set to take the critical procedural vote, House Speaker Nancy Pelosi is forced to find a way to get the moderates on board or face a major setback at the hands of members of her own party. "Time kills deals," the moderates, led by Rep. Josh Gottheimer said in the op-ed. "This is an old business saying and the essence of why we are pushing to get the bipartisan infrastructure bill through Congress and immediately to President Biden’s desk — as the president himself requested the day after it passed the Senate."
Biden spending agenda faces key test as moderate Dems, Pelosi face off
Sales of existing homes in Jul rose 2% from Jun to a seasonally adjusted, annualized rate of 5.99M units, according to the National Association of Realtors. These sales figures are based on closings, so it reflects contracts signed in May & Jun. Sales were 1.5% higher than Jul 2020, the 2nd straight month of gains after a pullback in the spring. Sales are likely improving due to rising supply. The inventory of homes at the end of Jul stood at 1.32M, down 12% from a year ago, but that is a smaller annual decline than in recent months. At the current sales pace, that represents a 2.6-month supply. A 6-month supply is considered a balanced market between buyers & sellers. Despite the slight increase in supply, demand continued to outpace it, pushing prices to another all-time high. The median price of an existing home sold in Jul was $360K, a 17.8% increase compared with Jul 2020. Some of that price increase is skewed by the types of homes currently selling, & current the market is much more active on the higher end. Annual price gains were larger last month, but given the huge spike in the market last summer, comparisons are now going to be smaller. “The housing sector appears to be settling down,” said Lawrence Yun, chief economist for the Realtors. “The market is less intensely heated as before.” It may be cooling, but it still appears to be competitive. Homes are spending, on average, just 17 days on the market. First-time buyers represented just 30% of the market, whereas they are usually around 40% historically. Nearly a ¼ of all buyers are using all-cash, also a higher share than normal. The latest read on sales of newly built homes from Jun showed a sharp decline both monthly & annually, according to the US Census. That data set is based on signed contracts, so it is looking at roughly the same activity as the Jul data on existing homes. Newly built homes come at a price premium to similar-sized existing homes & builders say they are now seeing even more buyers unable to afford what they would like. Mortgage rates didn't move much throughout May & Jun, when the bulk of these deals were made, but they did fall more sharply in Jul. That, in addition to increasing supply, could help boost sales at least slightly in the coming months. Mortgage applications to purchase a home, however, continue to run at a far slower pace that a year ago, according to the Mortgage Bankers Association.
Home sales rose in July, as demand outpaced slightly stronger supply
Divs paid to investors are projected to hit $1.39T in 2021, reflecting a recovery that's stronger than expected, according to a new report from British asset manager Janus Henderson. The 2021 forecast for divs is just 3% below the pre-pandemic peak, the firm found. Div payments in the 2nd qtr jumped 26% from the same period last year to $472B, just 6.8% below the levels seen in the 2nd qtr of 2019. Janus Henderson projected that div payouts will return to pre-pandemic highs within the next 12 months. The research said 84% of companies around the world either increased or maintained their divs compared to the same qtr in 2020. Much of the growth was attributed to companies restarting frozen payouts & issuing higher special divs on the back of strong earnings. Underlying div growth in the 2nd qtr, stripping out the effects of special divs & exchange rates, was 11.2%.
Dividend payouts to hit $1.4 trillion in 2021, nearing pre-pandemic levels, research shows
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