A setback in new home development and quarterly earnings reports greets investors this morning, though even the disappointing news here has not thrown pre-market indexes off a buoyant growth trajectory. At this hour, the Dow is up +140 points, the S&P 500 is +20 and the Nasdaq is +50 points. These are off the early morning highs somewhat, but the launch of a Bitcoin ETF today looks to have captured the lion’s share of attention thus far.
One of the most important components of the Great Reopening of the past 6+ months has been the housing market, though it has been anything but steady. The topsy-turvy course continues through the month of September, where Housing Starts have reported seasonally adjusted, annualized units of 1.555 million — notably off the expected 1.61 million, and -1.6% from a +0.3% expected for the month. The August headline number was revised down to 1.58 million.
Building Permits — a proxy for future starts — performed even worse: 1.589 million from an expected 1.69 million, -7.7% from last month’s 1.72 million and -3.4% from estimates. This represents a 12-month low, taking out the 1.59 million reported in June of this year and October 2020. It is also a far cry from the 12-month high in new permits: January’s 1.88 million.
We’ve seen housing prices go up nearly 20% this year, forcing some would-be buyers out of the market, at least temporarily. There have also been much-covered shortages, both in housing materials on supply-chain bottlenecks and workforce demands for higher wages and improved conditions. Further, Hurricane Ida ripped through the South and Northeast over this period, helping push monthly levels -6% and -27% in each, respectively.
If there is a silver lining here — and, to be clear, a million and a half new homes built in a month is far from a tragedy — it’s that most of the miss from estimates came from the less-valuable multi-family housing side. This comes as no surprise to followers of these metrics; multi-family home development in August was much higher than expected, so this lower number brings a bit of equilibrium here. The more-valuable single-family home creation was in-line with August numbers.
Two commercial drug and household products companies — Johnson & Johnson (JNJ - Free Report) and Procter & Gamble (PG - Free Report) — reported quarterly earnings before today’s opening bell. Results were good — mostly…
Johnson & Johnson reported Q3 earnings of $2.60 per share, beating expectations for $2.37 per share and a notable improvement from the year-ago quarter’s $2.20 per share. This amounts to a +9.7% earnings beat, which is in-line with the average beat of the previous four quarters (J&J never, ever posts an earnings miss — going back more than 10 years). However, revenues of $23.34 billion missed the Zacks consensus by -1.2%, and was below the year-ago $26.08 billion. For more on JNJ’s earnings, click here.
For Procter & Gamble, the Zacks Rank #2 (Buy)-rated company outperformed on both top and bottom lines in the company’s fiscal Q1 — $1.61 per share on earnings vs. $1.59 expected; $20.34 billion in sales beat the Zacks consensus by +2.5% — but no raise to guidance has caused a bit of a sell-off in the shares on the news, -2.2%. Neither P&G nor J&J are keeping pace with the S&P 500 year-to-date, so it will be interesting to see if at some point P&G becomes an attractive value play. For more on PG’s earnings click here.
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A setback in new home development and quarterly earnings reports greets investors this morning, though even the disappointing news here has not thrown pre-market indexes off a buoyant growth trajectory. At this hour, the Dow is up +140 points, the S&P 500 is +20 and the Nasdaq is +50 points. These are off the early morning highs somewhat, but the launch of a Bitcoin ETF today looks to have captured the lion’s share of attention thus far.
One of the most important components of the Great Reopening of the past 6+ months has been the housing market, though it has been anything but steady. The topsy-turvy course continues through the month of September, where Housing Starts have reported seasonally adjusted, annualized units of 1.555 million — notably off the expected 1.61 million, and -1.6% from a +0.3% expected for the month. The August headline number was revised down to 1.58 million.
Building Permits — a proxy for future starts — performed even worse: 1.589 million from an expected 1.69 million, -7.7% from last month’s 1.72 million and -3.4% from estimates. This represents a 12-month low, taking out the 1.59 million reported in June of this year and October 2020. It is also a far cry from the 12-month high in new permits: January’s 1.88 million.
We’ve seen housing prices go up nearly 20% this year, forcing some would-be buyers out of the market, at least temporarily. There have also been much-covered shortages, both in housing materials on supply-chain bottlenecks and workforce demands for higher wages and improved conditions. Further, Hurricane Ida ripped through the South and Northeast over this period, helping push monthly levels -6% and -27% in each, respectively.
If there is a silver lining here — and, to be clear, a million and a half new homes built in a month is far from a tragedy — it’s that most of the miss from estimates came from the less-valuable multi-family housing side. This comes as no surprise to followers of these metrics; multi-family home development in August was much higher than expected, so this lower number brings a bit of equilibrium here. The more-valuable single-family home creation was in-line with August numbers.
Two commercial drug and household products companies — Johnson & Johnson (JNJ - Free Report) and Procter & Gamble (PG - Free Report) — reported quarterly earnings before today’s opening bell. Results were good — mostly…
Johnson & Johnson reported Q3 earnings of $2.60 per share, beating expectations for $2.37 per share and a notable improvement from the year-ago quarter’s $2.20 per share. This amounts to a +9.7% earnings beat, which is in-line with the average beat of the previous four quarters (J&J never, ever posts an earnings miss — going back more than 10 years). However, revenues of $23.34 billion missed the Zacks consensus by -1.2%, and was below the year-ago $26.08 billion. For more on JNJ’s earnings, click here.
For Procter & Gamble, the Zacks Rank #2 (Buy)-rated company outperformed on both top and bottom lines in the company’s fiscal Q1 — $1.61 per share on earnings vs. $1.59 expected; $20.34 billion in sales beat the Zacks consensus by +2.5% — but no raise to guidance has caused a bit of a sell-off in the shares on the news, -2.2%. Neither P&G nor J&J are keeping pace with the S&P 500 year-to-date, so it will be interesting to see if at some point P&G becomes an attractive value play. For more on PG’s earnings click here.
Free Report – The Bitcoin Profit Phenomenon
Zacks Investment Research has released a Special Report to help you pursue massive profits from the world’s first and largest decentralized form of money.
No guarantees for the future, but in the past three presidential election years, Bitcoin’s returns were as follows: 2012 +272.4%, 2016 +161.1%, and 2020 +302.8%.
Zacks predicts another significant surge. Click below for Bitcoin: A Tumultuous Yet Resilient History.
Download Now – Today It’s FREE >>
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