Tag: market

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The most competitive housing market in the country based on frequency of bidding wars is a state capital in the Mid-Atlantic region

The housing industry, nationwide, could be fewer aggressive than it was just a few months back. In some parts of the U.S., however, potential buyers are not out of the woods when it will come to encountering competing offers when they put a bid on a for-sale house.

In November, just 59.5{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996} of presents offered by Redfin
RDFN,
+5.47{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996}
brokers faced level of competition, the true-estate brokerage claimed in a new report launched Friday. That is down from the pandemic peak of 74.6{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996} in April, and signifies the least expensive level of competitors considering that December of final 12 months.

Nevertheless, the frequency of bidding wars remained high for late fall and early winter season, mentioned Daryl Fairweather, chief economist at Redfin. “For this time of 12 months, there’s actually very a lot of demand,” Fairweather explained, adding that less property owners commonly listing their qualities in December.

Also see: These 10 ‘hidden gem’ housing markets are poised for big growth in 2022, Realtors forecast

“Most prospective buyers who might be out there are looking at homes that are the leftovers from previously this year, and all those are the varieties of houses that won’t truly attract a bidding war,” she said.

Some marketplaces continue to see a very significant fee of bidding wars, even as opposition at a nationwide level has dissipated with the advent of cooler climate. Richmond, Va., recorded the optimum proportion of offers experiencing competitiveness, with 80{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996} of the provides presented by Redfin brokers efficiently moving into into a bidding war. That was up from nearly 70{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996} of offers in the past thirty day period.

Salt Lake Metropolis, Utah, had the second maximum charge of bidding wars at just about 74{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996}, followed by San Diego, Honolulu and Dallas.

A different competitiveness rating from Redfin, which incorporates facts on bidding wars and the volume of time homes devote on the sector, confirmed that the 3 most aggressive metro regions nationwide for housing had been Aurora, Colo. Fremont, Calif. and Spokane, Wash.

“‘This is emblematic of exactly where we’re at in this phase of migration.’”


— Daryl Fairweather, main economist at Redfin

What all of these marketplaces have in frequent, Fairweather stated, is that they are satellite towns, rather than big metropolitan spots.

“This is emblematic of where by we’re at in this section of migration,” she reported. “At the commencing of the pandemic, most people just wished place and was going out to much more rural places, but now that items are reopening these satellite cities, I believe, are going to be actually well known going forward.”

In typical, these housing marketplaces current extra very affordable alternatives for potential buyers but keep a lot of of the facilities a single would delight in in a major, and commonly more pricey, city. Above a third of folks seeking for houses in Richmond, Va., for occasion, had been from outside the metro spot, with most of those migrants coming from the Washington, D.C., region around 100 miles absent.

Irrespective of whether housing markets remain as competitive as they are now into 2022 will depend on exactly where dwelling prices and house loan fees are headed. In January and February of 2021, expectations that interest fees would maximize really contributed to the surge in home shopping for that happened previously this calendar year, Fairweather mentioned.

“That was fueling folks to rush to get homes, which is why costs started off to shoot up,” she said, but she added that it’s unclear no matter whether the enhance in mortgage charges most economists are predicting for 2022 will have the exact result.

“It’s difficult to say how a lot of people today who have been paying out awareness to property finance loan charges have not purchased already due to the fact that narrative has been all-around all calendar year extended,” Fairweather explained.

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The outlook of the financial market and economic regulations in Cyprus

The island of Cyprus has observed the institution of extra than 40 firms, which includes some of the world’s most nicely-recognised economical institutions, all through the system of the previous a number of months.

Cyprus, a Mediterranean island very best renowned for its beaches, has an unexpectedly large variety of foreign trade (Forex) brokers found below its jurisdiction.

Given that the Cyprus Securities and Trade Commission (CySEC) granted its very first license to Windsor Brokers in 1988, far more than forty international forex investing businesses have been recognized in the nation.

Marketplaces.com and FXTM, two of the most perfectly-known corporations in the industry, have selected Cyprus as the spot for their headquarters instead than the Metropolis of London.

What is it about this seemingly isolated island that tends to make it so critical to the global economy?

Tax coverage may possibly be able to offer answers to these challenges. Cyprus has 1 of the world’s most affordable company tax charges, at 12.5 {21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996}, which is considerably reduce than the United Kingdom’s individual 19 p.c amount.

Regulation of all fiscal goods is required by EU laws and the Markets in Fiscal Instruments Directive (MiFID) in order to ensure that they meet up with sure necessities.

How Does CySEC Perform?

The Cyprus Securities and Exchange Fee (Cyprus Securities and Exchange Fee) is one of the country’s financial watchdogs (CySEC). Since Cyprus is an EU member state, the CySEC is subject matter to the European MiFID economical harmonization guidelines, which are acknowledged as MiFID II.

There are a appreciable amount of abroad retail currency trading and binary solutions corporations that have been licensed by the Cyprus Securities and Exchange Fee.

A regulatory overall body in Cyprus dependable for safeguarding investor defense and the ongoing wellness of the market, regarded as the Cyprus Securities Trade Fee (CySEC). CySEC was mandated by the European Union in 2004 to adhere to the EU’s money regulatory framework in purchase to assurance that Cyprus-registered companies have access to all European marketplaces. Furthermore, as time passes, the quantity of CySEC controlled brokers grows thanks to the commercial and economic rewards of Cyprus. This occurs for the reason that of the government’s initiatives to make it more simple to create enterprises in the place. Cyprus has turn out to be a person of the most desirable locations for investors and businessmen looking to earn a lot more funds. and a single of the most important explanations for this is the reduced taxation amount for businesses.

The board of directors of CySEC, a single of Europe’s most significant and very best-regarded economical regulatory companies, was nominated by the Council of Ministers. CySEC is a single of Europe’s largest and most effective-recognized economic regulatory companies.

For additional information, you should see Article 25 of the Cyprus Securities and Trade Commission (Establishment and Duties) Legislation. Adhering to are some of the organization’s most significant obligations:

The Cyprus Securities and Exchange Commission (CySEC) is a regulatory agency that is accountable for guaranteeing the appropriate procedure of the Cyprus Stock Exchange as properly as other controlled marketplaces in the country.

Just about every transaction on the Cyprus Stock Trade is meticulously documented.

In addition, it retains a watchful verify on all of the publicly traded corporations and monetary companies that arrive inside of its jurisdiction.

In the scenario of a breach of the policies, the Act allows for administrative and disciplinary sanctions to be executed.

Advocate for the cessation of operations that are in violation of securities sector regulations.

Fiscal Markets in Cyprus

In modern yrs, the country’s capital marketplaces setting has found a considerable transformation as a consequence of the country’s sturdy expert solutions and investment decision funds enterprises. Companies searching for to diversify their portfolios and get obtain to EU money marketplaces, as nicely as those seeking to set up specialized industries, are significantly currently being drawn to the regional market of Cyprus as a low-cost different.

Because of to its price tag-performance, trader-friendly and clear tax method, European passport for issuance, euro forex, and seamless transit of funds and securities, Cyprus is getting to be an significantly appealing vacation spot for stock marketplace listings. Malta, Europe’s money marketplace entry stage, has concentrated on getting a major listing spot for other building markets, instead than only its possess. With this proposal, the Cyprus Inventory Exchange will be the focal stage. Because of the addition of boutique companies and the promotion of the Cyprus Stock Trade as a important financial growth motor, the Cyprus Stock Exchange has emerged as a critical growth lever for the country’s foreseeable future improvement.

The Cyprus Stock Trade (CSE) would like to enhance its placement as a major capital raising mechanism, with its main target being to guide enterprises and corporations recover from the negative effect they have experienced on the country’s economy as a full. The CSE’s stock marketplaces ought to continue to appeal to new enterprises, which will end result in a broader variety of financial investment prospects for the company’s shareholders. The CSE presents a fantastic wide range of positive aspects as effectively as shortcomings. As indicated just before, exchanges are also responsible for the registration of all of a company’s standard securities, in addition to offering all of the aforementioned providers. By complying with all EU laws and generally identified securities requirements, the Trade makes certain that its shoppers and employees function in a safe and sound and protected setting.

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The hottest housing market of 2021

The U.S. housing market has been “bonkers” and is “still nuts” — words recently used by real estate guru Barbara Corcoran on Yahoo Finance Live. Since COVID-19 emerged, homes are being sold at a record clip and prices are skyrocketing across the nation. But the frenzy is especially magnified in one Sunbelt City.

Austin is this year’s Yahoo Finance 2021 hottest housing market. According to almost every real estate company that tracks home prices, no matter how you slice and dice the data, home prices in the capital city of Texas have soared, outpacing the nation. 

It’s also probably not much of a surprise to industry watchers and at least one real estate company. Zillow predicted Austin would be the hottest city of 2021 way back in January. Now Zillow (Z) is predicting by the end of this year the Austin metropolitan area will become the least affordable major metro region for homebuyers outside of California; it has already surpassed Boston, Miami, and New York City.

“The Austin market has stood out and it’s because of the phenomenal shift in remote work, outperformance of tech industry and search for affordability,” said Danielle Hale, economist at Realtor.com, adding that even though prices have risen in the market it’s still half as expensive as other major cities.

Median sales price of single-family homes in the Austin metro area rose 33.5{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996} to $498,400 in the third quarter of 2021 from the same period a year ago, far outpacing the national median home price increase of 16{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996} for the same time period, according to the National Association of Realtors (NAR). Among the 50 major cities that Realtor.com tracks, Austin led the pack in terms of annual median listing price growth by posting a 15.9{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996} increase. Similarly, NerdWallet found that among the nation’s largest metro areas, Austin saw the highest increase in listing price — a 29{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996} rise in the third quarter from the same period last year.

Austin is “well positioned as a fairly affordable destination to buy a family-sized home in a location that has a lot of cultural cache,” said Jeff Tucker, Zillow’s senior economist.

‘A cool city’

Like many other warmer climate metros, Austin benefited from the COVID migration. But some would argue folks from all around the nation and even world were already flocking to the City of the Violet Crown (Austin shares this moniker with Athens, Greece) well before the virus arrived in the U.S., and not just for South by Southwest (SXSW), an annual interactive media and music festival.

“Austin was popular before COVID, it is a cool city,” said Elizabeth Renter, NerdWallet’s data analyst. “It would be topping the list of price increases and inventory decreases regardless of COVID, maybe not to this extreme.”

While most people arriving in Austin came from Los Angeles, San Jose, and San Francisco in 2020, according to a Zillow analysis, Tucker noted that the city is “a sweet spot, it attracts a lot of people from all over (migration from the West Coast, Northwest and Midwest).” Other U.S. cities like Miami tend to only be destinations for Northeast and Midwest residents, and Boise catches the eye of mostly Californians.

“Austin is a very progressive city that offers everything from not just a scenic perspective: rolling hills, great lakes. It has a very active lifestyle, it’s a tech-centric city,” said Romeo Manzanilla, former president for Austin Board of Realtors and managing director for Compass. “People from the East and West Coasts can identify with it.”

Austin Texas aerial drone of capital city of Texas - Austin texas panoramic panorama aerial drone sunrise golden colors across colorful skyline cityscape

Austin is “a cool city” that attracts homebuyers from both coasts and even outside of the U.S. Credit: Getty

It is home to billionaire and newly anointed Time Person of the Year, Elon Musk, who officially moved Tesla’s (TSLA) headquarters from California this year. Similarly, software maker Oracle (ORCL) has decamped to Austin, where it opened a campus in 2018, from Silicon Valley. And just last month, Samsung said it plans to build a $17 billion semiconductor factory right outside of Austin that is expected to be operational in the second half of 2024.

Meanwhile, next year Apple (AAPL) is expected to complete its $1 billion, 133-acre campus, which will eventually house 15,000 employees in Austin. And since establishing its first office in Austin in 2007, Google (GOOG, GOOGL) has expanded its office space in the city and now has 1,100 employees there. The latest spate of activity has essentially revived Silicon Hills, a nickname given to Austin in the 1990s. 

“Companies relocating to or expanding secondary headquarters in Austin have created substantial job opportunities and drawn people in. The combination of a strong local economy with the flexibility that people don’t have to have a job in Austin” to live there has made the market a standout, said Hale.

Job growth in Austin has been happening “for many years,” said Lawrence Yun, chief economist at the National Association of Realtors, in an email. “Based on the migration patterns of many Californians moving in, one can surmise it is due to tech sector expansion in the metro region.”

During the third quarter of 2021, 54{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996} of people looking for homes in Austin were from outside of Texas including home hunters from overseas, according to Hale. Forty-six percent came from other parts of the state.

It also helps that Austin is in a “tax-friendly state (there’s no income tax) so it’s more beneficial for high-income taxpayers,” she added.

People from the Bay Area and Los Angeles “have more liquid funds to come in and put in an offer [on a home] well above asking [price],” said Manzanilla. “They have made our market competitive.”

Even before the onset of COVID in February 2020, the median home sales price in Austin was $325,000, far cheaper than a home in San Francisco, where the median sales price was $1.4 million, according to Daryl Fairweather, chief economist at Redfin. Still, that was more expensive than the national median home sales price of $302,000.

“It has been a frustrating experience for long-time local residents. Trying to outbid new tech employees has been difficult,” said Yun. “Any monthly savings accumulated for a down payment has become irrelevant as home prices rose even faster than the savings rate.”

But relief may be on the way, as experts note that there are early signs that the Austin housing market is cooling down. In fact, Fairweather said price growth has already peaked this year in April. Like the rest of the nation, price growth will subside to single-digit rates going into 2022, compared to as much as north of 20{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996}, according to Fairweather.

The number of homes for sale in Austin is also on the rise. According to NerdWallet, the number of homes listed for sale in Austin rose 73{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996} in the third quarter of 2021 from the prior quarter, leading the largest metros in the nation in terms of inventory growth.

That should help alleviate price pressure in the city, even as homes on the market fly off the shelf. During the third quarter of 2021, homes for sale were on the market for a mere 24 days, compared to 40 days nationally, according to NerdWallet’s Renter.

Celebrity and Austin native Matthew McConaughey, who as a minority stakeholder in the MLS team Austin FC helped the city welcome its first professional sports team this year, summed up why the Austin is so hot in an extensive interview with Yahoo Finance Editor-in-chief Andy Serwer last year: “Austin used to be a college town, a government town, and a music town. It’s now a banker town, a tech town, and an international destination.”

Amanda Fung is an editor at Yahoo Finance.

Read the latest financial and business news from Yahoo Finance

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Stock market news live updates: December 14, 2021

Markets edged lower in early trading Tuesday following declines in yesterday’s session as investors tune in for on a prolific week in Washington that includes the Federal Reserve’s final policy-setting meeting of 2021, set to commence today, and the release of new prints on retail sales, housing starts and other economic data.

All three major U.S. indexes were down amid figures from the Department of Labor that showed wholesale prices soared by a record 9.6{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996} in November from a year earlier, the fastest annual pace on record for the indicator.

Traders are awaiting a decision from the Fed on how quickly the central bank will tighten monetary policy amid a backdrop of fresh inflation numbers that reflected the fastest annual increase in nearly four decades. The Labor Department’s Consumer Price Index (CPI) soared 6.8{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996} in November compared to last year, according to figures published last week.

The Federal Open Market Committee (FOMC) is scheduled to hold its two-day policy-setting meeting starting on Tuesday, followed by the release of the monetary policy statement and remarks from Federal Reserve Chair Jerome Powell Wednesday. An updated Summary of Economic Projections outlining individual members’ outlooks for economic conditions and interest rates is set to accompany the statement.

The Fed has been under pressure to control rising inflation levels, as investors watch for clues of a faster taper that could set the stage for earlier rate hikes.

“Because inflation expectations do appear to be adaptive, our view is that the longer inflation stays elevated, the greater the risk that consumers adjust their behaviors in a way that contributes to persistently elevated inflation” wrote PIMCO economist Tiffany Wilding in a recent note to clients.

“We believe the Fed will want to manage this risk by shortening the time over which it winds down its purchases of U.S. Treasuries and agency mortgage-backed securities (MBS), aiming to end the program in March 2022, while also signaling a June rate hike is likely,” said Wilding.

PIMCO managing director and portfolio manager Sonali Pier also separately told Yahoo Finance Live that the firm expects to see two hikes in 2022, three hikes in 2023, and potentially four in 2024, with the Fed trying to bring the policy rate to neutral.

“Amid proliferating signs of solid growth and a robust job market, various measures depict a deeply troubled economy,” wrote Oxford Economics senior economist Bob Schwartz in a new report. “Households are downbeat, according to sentiment surveys, and the so-called ‘misery index‘ that adds together inflation and unemployment hovers around recession levels.”

Markets await a trove of fresh economic data this week. November retail sales, out on Wednesday, are expected to rise by 0.8{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996}, according to Bloomberg consensus estimates. And November housing starts are forecasted to see a month-over-month increase of 3.3{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996}.

Meanwhile, Morgan Stanley projects the U.S. unemployment rate will drop to 3{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996} in 2022.

“It’s stunning to see how much the rate has fallen in the last five months,” Morgan chief U.S. economist Michael Feroli told Yahoo Finance Live. “We expect that pace of decline to slow, but it doesn’t take much to get below 4{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996}, even with a tick up in the labor participation rate which has been depressed over the last year and a half.”

12:05 p.m. ET: Microsoft posts biggest drop since 2020

Shares of Microsoft (MSFT) were down more than 4{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996} in midday trading, contributing to the Dow’s losses as the broader markets edged lower.

The software giant posted its biggest drop since last October, according to Bloomberg data, adding to yesterday’s loss of nearly 1{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996} at close.

Separately, J.P. Morgan released fresh research on Tuesday that said investors overlook Microsoft’s leading position in data management. Data platform solutions contributed to about 12{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996} of Microsoft’s total revenue in 1H21, up from roughly 10{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996} in 2017, according to the bank’s note, which also said much of the company’s growth is driven by cloud data platforms that grew from about 3{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996} of total revenue to about 7{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996} in the same time period. J.P. Morgan expects this to be a key source of upside heading into 2022.

Microsoft had a year of stunning numbers that made it Yahoo Finance’s company of the year. The tech heavy weight passed a $2 trillion market capitalization in June and reported a $176 billion surge in revenue — a nearly 20{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996} year-over-year increase.

11:13 a.m. ET: Dow reverses comeback, shedding more than 100 points

Here were the main moves in markets as of 11:13 a.m. ET:

  • S&P 500 (^GSPC): -52.68 (-1.13{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996}) to 4,616.29

  • Dow (^DJI): -121.43 (-0.34{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996}) to 35,529.52

  • Nasdaq (^IXIC): -279.60 (-1.81{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996}) to 15,133.68

  • Crude (CL=F): -$1.00 (-1.40{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996}) to $70.29 a barrel

  • Gold (GC=F): -$12.10 (-0.68{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996}) to $1,776.20 per ounce

  • 10-year Treasury (^TNX): +2.6 bps to yield 1.4500{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996}

11:01 a.m. ET: Meme-stock darling AMC extends decline

Shares of AMC Entertainment Holdings Inc. (AMC) were down 2.19{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996}, trading at $22.73 a piece, though recouping some losses after falling as much as 11{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996} at the open. The company was hit hard in Monday’s sell-off along with other retail favorites, including Bed Bath & Beyond Inc. (BBY) and Tesla (TSLA).

The losses come as investors expect a rollback of pandemic-era stimulus by the Federal Reserve, putting risky assets and tech companies under pressure.

Retail investors comprise 20{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996}-30{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996} of trading volume, according to research from J.P. Morgan—a change from last year when these traders were seen as small-time market players.

10:17 a.m. ET: Dow turns green following tumble

Here were the main moves in markets as of 10:17 a.m. ET:

  • S&P 500 (^GSPC): -32.00 (-0.69{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996}) to 4,636.97

  • Dow (^DJI): +16.28 (+0.05{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996}) to 35,667.23

  • Nasdaq (^IXIC): -200.53 (-1.30{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996}) to 15,212.75

  • Crude (CL=F): -$0.72 (-1.01{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996}) to $70.57 a barrel

  • Gold (GC=F): -$13.10 (-0.73{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996}) to $1,775.20 per ounce

  • 10-year Treasury (^TNX): +3.9 bps to yield 1.4630{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996}

9:30 a.m. ET: Markets open lower ahead of Fed decision

Here were the main moves in markets as of 9:30 a.m. ET:

  • S&P 500 (^GSPC): -36.88 (-0.79{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996}) to 4,632.09

  • Dow (^DJI): -141.06 (-0.40{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996}) to 35,509.89

  • Nasdaq (^IXIC): -217.32 (-1.39{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996}) to 15,413.28

  • Crude (CL=F): -$0.92 (-1.29{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996}) to $70.37 a barrel

  • Gold (GC=F): -$20.90 (-1.17{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996}) to $1,767.40 per ounce

  • 10-year Treasury (^TNX): +2.7 bps to yield 1.4510{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996}

9:05 a.m. ET: Stock futures tick down

Here were the main moves in futures trading Tuesday morning:

  • S&P 500 futures (ES=F): -28.50 points (-0.64{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996}), to 4,640.25

  • Dow futures (YM=F): -100 points (-0.28{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996}), to 35,545

  • Nasdaq futures (NQ=F): -170 points (-1.06{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996}) to 15,912

8:48 a.m. ET: Wholesale inflation surges 9.6{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996}

Wholesale prices soared by a record 9.6{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996} in November from a year earlier, the fastest annual pace on record for the indicator and a sign inflation pressures are likely to persist well into 2022.

The Labor Department reported Tuesday that its producer price index rose 0.8{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996} in November after a 0.6{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996} monthly gain in October. The figure, which measures inflation before it reaches consumers, marked the highest monthly reading in four months.

Food prices jumped 1.2{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996} in November after falling 0.3{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996} in October. Energy prices were up 2.6{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996} after a 5.3{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996} percent rise October.

7:07 a.m. ET: Stock futures mixed

Here were the main moves in markets in early trading Tuesday:

  • S&P 500 futures (ES=F): -8.25 points (-0.18{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996}), to 4,660.5

  • Dow futures (YM=F): +22.00 points (0.06{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996}), to 35,667

  • Nasdaq futures (NQ=F): -85.25 points (0.53{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996}) to 15,996.75

6:00 p.m. Monday ET: Stock futures edge higher

Here were the main moves in markets in late trading on Monday:

  • S&P 500 futures (ES=F): +5.50 points (0.12{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996}), to 4,674.25

  • Dow futures (YM=F): +46.00 points (0.13{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996}), to 35,691

  • Nasdaq futures (NQ=F): +10.75 points (0.07{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996}) to 16,092.75

—

Alexandra Semenova is a reporter for Yahoo Finance. Follow her on Twitter @alexandraandnyc

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Posted on

The market fever hasn’t broken

A feeling of unreality still pervades financial markets. Investors who take fiduciary duties seriously still exist — but they’re seemingly outnumbered by people who see investing as a fun get-rich-quick game.

Why it matters: The post-pandemic return to some kind of pre-pandemic “normal” has yet to arrive, and as a result there’s a lot of worry about the disruption and volatility that could accompany such a transition. The markets, so far, have done an excellent job of climbing that wall of worry.

The big picture: The defining characteristic of the pandemic era has been feverishness. The initial weeks of uncertainty and isolation felt like a fever dream, with time dilating and reality warping. After that, the whole country entered a particularly febrile state, as the Black Lives Matter movement and the 2020 presidential election ratcheted up the nation’s emotional temperature to unsustainable levels.

  • Markets have not been immune. In some ways, they’re the last bastion of delirium, in a country where vaccines and a boring president have allowed much of the country to feel some semblance of normality.
  • Money has become something to play with for fun and profit. There are even now hundreds of play currencies, some of which are worth hundreds of billions of dollars, for people who find government-issued money too constrained.
  • The decadence is increasingly offensive to anybody living paycheck to paycheck, or even just people brought up to respect the value of a dollar.

Be smart: The strength of the economic rebound from the March 2020 recession came as a surprise to almost everyone — and helped to create windfall gains in everything from NFTs to mega-cap stocks.

  • Get-rich-quick fever has reached unprecedented levels over the past 18 months, encompassing everything from GameStop and Dogecoin to SPACs and even Spider-Man tickets. One company became a unicorn by persuading individual investors to buy securitized art.

Financial shenanigans are everywhere you look; Bloomberg’s Matt Levine, for instance, has a masterful dissection of the $1 billion private investment in Donald Trump’s barely-existent new social-media company — a classic greater-fool trade which doesn’t need to be based on any underlying value at all.

What they’re saying: Pollster Bruce Mehlman cites “extreme expectations” as the number one risk facing the U.S. in 2022. “Lack of realism and perspective is itself a major risk,” he tells Axios. “It undermines the rationality-based cooperation essential for the nation and its institutions to succeed as designed.”

The bottom line: The occasional crypto crash doesn’t mean the fever has broken. It just means the game is still exciting.

Posted on

Opinion: This surprising investing strategy crushes the stock market without examining a single financial metric

I am not a professional stock picker, but over the past decade my portfolio has beaten the stock market by a factor of three to one.

Unlike Peter Lynch, who advocated investing in the makers of products you love and who, in my estimation, stands out as one of the greatest of all stock pickers, I did not examine a single financial metric to build my portfolio. Instead, I simply ranked competitors in each industry based on customer love and then bet on the winner.

My portfolio has performed so well because the market undervalues the economic power of customer love. When customers feel loved, they come back for more and refer their friends. This is the economic flywheel that drives sustainable prosperity, and companies built on it generate surprising levels of profitable growth.

To measure customer love, I used the Net Promoter Score (NPS) that I created 20 years ago. It captures how likely a customer is to recommend a product or service to a friend or colleague. I relied on the market to incorporate all financial insights into the current stock price.

My buy-and-hold investing portfolio started with the 11 public NPS leaders profiled in my 2010 book, “The Ultimate Question 2.0“: Amazon
AMZN,
+0.43{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996},
Meta Platforms (formerly Facebook)
FB,
+2.70{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996},
Apple
AAPL,
+2.06{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996},
Costco Wholesale
COST,
-2.52{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996},
Google parent Alphabet
GOOG,
+0.20{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996}

GOOGL,
+0.14{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996},
Southwest Airlines
LUV,
+1.33{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996},
American Express
AXP,
+1.47{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996},
JetBlue Airways
JBLU,
+3.62{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996},
Verizon Communications
VZ,
-0.81{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996},
T-Mobile US
TMUS,
-2.36{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996},
NortonLifeLock
NLOK,
-1.25{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996}
and Metro PCS Communications (which merged with T-Mobile in 2013).

In hindsight some of those stocks look like no-brainers, but back when the book was written they were anything but. Amazon had a market cap below eBay’s. T-Mobile was considered by many to be the weakest player in mobile telephony.

In the years since, however, this group’s extraordinary customer focus has paid off. From Jan. 1, 2011 to Dec. 31, 2020 these stocks outperformed Vanguard’s Total Stock Market Index exchange-traded fund
VTI,
+0.35{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996}
by a factor of 2.8 to 1. (This performance is market-cap weighted and rebalanced quarterly akin to VTI’s rebalancing).


Fred Reichheld

Since then, Bain & Co., where I have worked since 1977, has applied NPS to a long list of industries, and created NPS Prism, a data benchmarking service that ranks competitor NPS on an apples-to-apples basis. As we X-ray more industries, we continue to uncover new NPS leaders, among them Texas Roadhouse
TXRH,
+2.91{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996},
Discover Financial
DFS,
-0.41{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996},
Tesla
TSLA,
+1.40{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996},
Chewy
CHWY,
+0.77{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996}
and FirstService
FSV,
-0.69{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996}.
 

I serve on the board of directors at FirstService, a real-estate services company whose social media handle #FirstServeOthers provides a hint about its corporate philosophy. Over the 25 years since the IPO, its annual total shareholder return has been just under 22{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996}, a better record than all but seven of the 2,800 firms with revenues of at least $100 million at the time of their NASDAQ listing. 

For a long time, like many great customer-focused organizations, it remained below investors’ radar screens. One reason: GAAP accounting is woefully lacking at measuring customer centricity. It doesn’t even require organizations to report the number of customers they serve, let alone how many are returning, increasing purchases, or referring friends and family. 

This makes it hard to find comparable data. I first discovered online pet supply retailer Chewy when its self-reported NPS appeared in its IPO documents. Chewy does a tremendous job tapping into the special emotional tie between owner and pet, with things like the hand-painted pet portraits the company mails as surprise thank-yous to customers, who, delighted, then post them, along with glowing testimonials, across social media.

By our calculations Chewy’s NPS beats Amazon’s by 24 points in its category — an extraordinary performance. Chewy’s own numbers are slightly different from ours, however, and the inconsistency of self-reported numbers is one reason we developed a new metric called earned growth rate. It measures the revenue growth generated by returning customers and their referrals by combining net revenue retention (NRR), the back-for-more battle-tested statistic used in the software-as-a-service (SaaS) industry among others, with earned new customers (ENC), measuring how much new customer spending is earned through referrals rather than bought through promotional channels.

NPS exemplar First Republic Bank
FRC,
-0.43{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996}
has in the past earned 82{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996} of its deposit growth, with 50{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996} coming from existing customers and another 32{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996} from referrals. Warby Parker
WRBY,
-2.38{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996},
the direct-to-consumer pioneer in prescription eyeglasses, earns almost 90{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996} of its new customers through referrals.

You can use this calculator to estimate your company’s earned growth rate.


Abingdon Press

In addition to these metrics, it’s also possible to spot NPS leaders by their common features.  

  1. They apply the Golden Rule – love thy neighbor as thyself. This often means eschewing bad profits. Discover Card, for example, never sells receivables to collection agencies.

  2. They empower their front-line employees to serve customers in creative ways. Companies like Chewy that give employees the freedom to serve customers with empathy and creativity engender trust in and loyalty to their companies.

  3. They integrate in-store and online customer feedback. Technology-rich companies like Warby Parker augment direct feedback with digital signals from customers and front-line employees to guide decision-making—crucial in helping companies respond to holiday shopping trends this season.

  4. They make customers their primary purpose. By going the extra mile to provide a customer with an experience that’s not just good, but remarkable, companies can play a part in enriching their lives beyond the product they offer.

I have spent most of my 44-year career focused on understanding the role that loyalty plays in building great organizations and helping leaders inspire their teams to embrace a mission of purposeful service enriching the lives of customers and colleagues. That is the right way—and the best way—to win in business and the stock market. 

Fred Reichheld is the creator of the Net Promoter system of management and the author of “Winning on Purpose: The Unbeatable Strategy of Loving Customers” (together with Darci Darnell and Maureen Burns), among other books.