Wednesday, April 12, 2023

🌀Buyer Beware: This Bubble Is Getting a Boost

Good morning. The housing market has started to come off of its extremes of the past few years...
It's the monthly jobs numbers today and they're not going to be pretty and will be possibly the tip of the iceberg as we head into May.

Good morning. The housing market has started to come off of its extremes of the past few years. Markets that saw the biggest moves higher have come down a bit, even as mortgage rates more than doubled last year.

However, in California, which has some of the highest home prices in the nation, as well as the worst income inequality, a new program has been launched. It will help buyers making up to $211,000 annually with 20 percent down payments needed to get a traditional mortgage. The kicker? That loan comes with zero percent interest.

Investors, at least real estate investors, should have no trouble finding buyers for properties in the Golden State. But over the long term, these kinds of easy-lending programs haven't looked helpful in the rear view mirror.

Now here's the rest of the news:

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MARKETS
DOW 33,684.79 +0.29%
S&P 4,108.94 -0.00%
NASDAQ 12,031.88 -0.43%
*As of market close
Stocks traded mixed on Tuesday, a late-day drop for stocks.
Oil jumped 2.2 percent, closing at $81.47 per barrel.
Gold rallied 0.8 percent, at $2,020 per ounce.
Cryptocurrencies generally rallied, with Bitcoin hitting $30,180 at the stock market close.

Today's TOP TIPS
Buy the Best Companies to Play a Hot Growth Trend
When a growth trend is underway, nearly every company that plays to that trend will rally. At least, at first. However, weaker companies will get squeezed out by competition, leading to only a few big players.

Of those players, a few will win based on quality. Others will cater to a lower-end market. When a sector is still new, chances are the higher-end product will perform better than the lower-end one until a few iterations of the technology are worked out.

» FULL STORY

Insider Trading Report: Business First Bancshares (BFST)
Edgar Smith, a director at Business First Bancshares (BFST), recently reported the purchase of 17,109 shares. The buy increased his holdings by 1 percent, and came to a total cost of $400,220.

He was joined by another director who bought 3,664 shares, paying just over $80,100. Other company directors have been buyers of shares over the past two years, with just one insider sale from a director over the same time period.

» FULL STORY

Unusual Options Activity: Silvercorp Metals (SVM)
Precious metals explorer and producer Silvercorp Metals (SVM) has rallied in recent weeks as gold and silver have jumped higher. One trader sees that trend continuing in the months ahead.

That's based on the October $7.50 calls. With 191 days until expiration, 20,109 contracts traded compared to a prior open interest of 127, for a staggering 158-fold jump in volume on the trade. The buyer of the calls paid $0.18 to make the bullish bet.

» FULL STORY

IN OTHER NEWS
Auditors Under Fire for Role in Bank Failures

Accounting firms are coming under criticism for giving banks a clean bill of health before recent failures. KPMG LLP gave Silicon Valley Bank a clean audit two weeks before the bank collapsed. The auditor had no comment on the bank's bond portfolio, which ultimately led to the bank's failure.
17 Percent of Car Buyers Paying At Least $1,000 Per Month

While the supply of the car market has stabilized, a record number of Americans are paying over $1,000 per month when financing is factored in. A full 17 percent of buyers are now paying at least that amount, a record high. It's unclear how much higher payments can go before buyers start to step aside.
Tupperware Gives "Going Concern" Notice

Tupperware (TUP) saw shares get cut in half on Monday, following a regulatory filing that warned that the company may not be able to continue as a going concern. The company is working with financial advisors to keep going, but at present the company doesn't have enough cash to fund operations.
BYD Unveils Shock Absorption Technology

Chinese electric car company BYD has unveiled a new shock absorption technology. The new tech allows for stable car rides on rugged terrain, sharp turns, and shallow water. The company expects to have further details on the system's costs, and when it can become widely available.
FTC Orders $600K Payment in Hijacked Amazon Review Case

The Federal Trade Commission has approved its first-ever enforcement action in a case involving review hijacking. Supplements retailer The Bountiful Company, maker of Nature's Bounty, will pay $600,000 for deceiving customers on Amazon by merging reviews of different products to boost ratings artificially.

S&P 500 MOVERS
TOP
KMX  10.173%
CF  6.01%
MHK 5.743%
MOS 4.787%
SYF 4.514%
BOTTOM
CTLT 2.468%
WBD 2.37%
MRNA 2.36%
MSFT 2.074%
KR 1.769%

Quote of the Day
We're seeing what we believe is the same investor narrative, which is uncertainty around the mixed economic data, which is driving uncertainty around Fed policy and a greater concern — particularly with Friday's strong employment data — that the Fed may again move forward with another rate hike. And I think investors have greater concerns about a potential U.S. recession, and the markets seem to be under greater pressure as the Fed decision looms.
- Greg Bassuk, analyst at AXS Investments, on why investors expect a further rate hike from the Fed next month as Friday's jobs data showed a slight slowdown in the labor market.

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