Home Prices Rose Again. They Were Expected to Fall.

Market Movers

• Home prices rose again. They were expected to fall. Purchases of new single-family homes increased 9.6%* to an annualized 683,000 pace last month from a downwardly revised 623,000 rate in February, government data showed Tuesday. It's suggesting that an easing in mortgage rates is helping the housing market find some footing.

• Layoffs and closures are hitting left and right with Disney and Lyft layoffs. Disney began laying off another group of employees off this week, bringing the total number of cuts this year to 4,000 as part of the company’s plan to cut 7,000 positions. Meanwhile, Lyft confirmed a round of layoffs in a blog post but didn't specify how many. Source(30:26)

• Spotify draws more listeners, including paying subscribers. The streaming giant reported 515 million monthly active users, up 22% from a year earlier. That topped company expectations by 15 million* and marked its largest-ever first-quarter growth. Spotify said that growth came across nearly all age demographics and from both developed and developing markets.

• McDonald’s tops sales estimates as diners shrug off price rises. The fast food chain reported first-quarter sales and profit that outpaced analysts’ projections, a renewed sign that the burger chain is picking up customers amid stubborn inflation* and higher menu prices. The key metric of comparable sales rose nearly 13% above the average estimate of 8.2% compiled by Bloomberg.

• Punishing for high credit score. A new ruling came in that will punish high credit score individuals* that put down 20% down payments to buy their homes. It is more complicated than that but essentially the two things that hurt you are: 1) 700+ credit score and 2) high down payments.

What to Watch

• Biden prepares to take his case for a second term to American voters. There could be a Biden-Trump rematch next fall. Joe Biden is expected to announce as early as today that he’s running for a second term as US president. Former president Donald Trump has already put his hat in the ring and he’s currently the leading Republican candidate. Source(0:45)

• 3M to cut 6,000 jobs in CEO’s latest move to blunt sliding sales.The reductions, part of a wider restructuring of the manufacturer, are expected to trim annual costs by as much as $900 million, 3M said in a statement reporting first-quarter earnings. The company has announced 8,500 total job cuts this year, equating to about a 9% decline in its global workforce.*

• JetBlue forecasts profit thanks to strong travel demand. For the second quarter, they expect strong revenue growth to continue as demand remains robust and as they see continued momentum from their commercial initiatives. They are forecasting a solidly profitable quarter, and remain confident in their full-year earnings outlook.

• GM raises 2023 profit outlook as car buyers continue to splurge. GM reported first-quarter pretax profit that blew past analysts’ forecasts. The nation’s largest automaker by sales said it lifted 2023 profit guidance because the results for the January-to-March period outpaced expectations and cost savings* from a recent employee-buyout program are flowing to the bottom line.

• Final look at local housing markets in March. The big story for March existing home sales was the sharp year-over-year (YoY) decline in sales. Also, active inventory increased YoY, but is still historically low - and new listings were down YoY. Early expectation is we will see a somewhat similar YoY sales decline NSA in April as in March.

• PepsiCo raises outlook as quarterly results beat expectations. PepsiCo Beverages North America’s organic revenue increased 12%, with Pepsi delivering double-digit net revenue growth and brands like Gatorade and Aquafina delivering high single-digit net revenue growth. The company said it expects its full-year 2023 organic revenue to increase by 8%, up from 6%.