Happy Friday, readers. The US housing market has been the talk of the pandemic, and it may finally be cooling. Want to know one way to gauge the market?
Let's take a look at lumber prices.
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1. Here's one way to take the temperature of the housing market. Take a look at lumber prices. The price of the key building material just dropped to its lowest level of the year, as builders adjust their expectations for housing demand amid skyrocketing mortgage rates.
Lumber prices surged during the pandemic, boosted by big housing demand and broken supply chains due to COVID-19. Lumber futures were trading at $700 per thousand board feet yesterday, down as much as 6%.
Existing home sales in April fell 2.4% from March levels, boosting inventory of unsold existing homes to 1.03 million homes. First-time buyers were the largest percentage of sales at 28%, while investors bought 17% of the homes for sale.
Talk of a housing bubble has been brewing since early in the pandemic, and the frenzy of buyers looking for more space amid the lockdown has been well documented. But with mortgage rates spiking this spring to above 5% and hovering around their highest level in 13 years, there's been growing chatter around the bubble popping.
Lumber was just one of many commodities that soared during the pandemic, joined by nickel, copper, uranium, and other key materials.
In other news:
2. US stock futures rise early Friday, after China cut a key lending rate. Here are the latest market moves.
3. On deck today: Foot Locker Inc., Regency Affiliates Inc., and Deere and Co., all reporting.
4. A portfolio manager at Mario Gabelli's $41 billion firm shares his stock picks. Kevin Dreyer identified a list of names that will deliver strong returns even as inflation soars. Read his list of 27 stocks to buy here.
5. The stock market sell-off has entered a new phase. That's according to top economist Mohamed El-Erian, who says that investors now have earnings growth to worry about on top of Fed policy moves. Read what El-Erian has to say.
6. Twitter jumped after the company reportedly told employees the Musk deal is still on. Executives said there is no such thing as the deal being "on hold" as the Tesla chief has claimed. Twitter said it would enforce the $54.20 offer price.
7. Russian oil production is rebounding. According to the Kremlin, supplies may find an indirect route to Europe even as companies shun crude products from the country. A top official said output increased by 200,000-300,000 barrels per day in April.
8. Investors should set their bitcoin orders at this price. Blockchain founder Richard Heart has nailed bitcoin's tops and bottoms. He's eyeing this level for the cryptocurrency — and says this is one of the only coins investors should buy in a bear market.
9. Here are the five qualities investors should look for in stocks right now. The portfolio manager at a $26 billion firm has a few tips for navigating a challenging macroeconomic environment. Here are four companies he'll be betting on for years to come.
10. Billionaires' tax rate was less than 5% in recent years. According to analysis by Americans for Tax Fairness, 26 of the richest people in the US paid an average federal income tax rate of 4.8%. See how billionaires' taxes shook out here.
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Curated by Max Adams in New York. (Feedback or tips? Email [email protected].) Edited by Hallam Bullock (tweet @hallam_bullock) in London.