Housing Market Insights - Housing Starts for July reached 1.43 million seasonally adjusted, annualized units, significantly exceeding the projected 1.29 million and the revised 1.36 million from the previous month, marking the highest level since February and the third-best month in the past year [2] - Building Permits fell to 1.35 million, below the expected 1.39 million and the downwardly revised 1.39 million from the prior month, indicating a fourth consecutive monthly decline, reminiscent of levels seen during the Covid pandemic [3] Multi-family vs. Single-family Housing - Multi-family housing saw a substantial increase of +11.6% month over month and +27% year over year, suggesting strong demand for apartment and condo living despite high supply [4] - Single-family housing growth was positive but lagged behind multi-family, with increases of +2.8% month over month and +8% year over year, impacted by high mortgage rates keeping potential buyers sidelined [5] Home Depot Performance - Home Depot reported Q2 earnings of $4.68 per share, missing expectations by 3 cents, resulting in a -0.64% earnings surprise, marking the second consecutive earnings miss [6] - Revenues for the quarter were $45.38 billion, slightly missing expectations by -0.5%, but still reflecting a nearly +5% year-over-year increase; the company maintained its fiscal year guidance, contributing to a +1.6% rise in stock price during early trading [7] Upcoming Market Events - Fed Vice Chair Michelle Bowman, a proponent of a 25 basis point interest rate cut, is scheduled for appearances today, ahead of the release of the FOMC meeting minutes, which may provide insights into potential future rate cuts [8] - Luxury homebuilder Toll Brothers is set to report fiscal Q3 earnings, with estimates indicating a slight year-over-year decline in earnings (-0.28%) but a revenue increase of +4.56% compared to the previous year [9]

I'm the finance executive editor Brian Saz and you're taking a look at a live shot of the opening bells on Wall Street on this Monday morning. Megaish ringing the bell at the New York Stock Exchange and CTW Cayman, a gaming platform company getting things popping over there at the NASDAQ. Now, there will be no shortage of market moving events this week.Ukraine President Vladimir Zalinski will be back in Washington after President Trump met with his Russian counterpart Vladimir Putin last week. Other Europea ...

Core Viewpoint - Realty Income is poised for a potential recovery in its stock price due to anticipated interest rate cuts, which could enhance its financial performance and attractiveness to investors [1][4][13]. Group 1: Company Overview - Realty Income specializes in single-tenant net-leased properties and has built a substantial portfolio over 56 years, owning or holding interest in over 15,600 properties as of the end of Q2 2025, compared to just above 6,500 properties at its peak in February 2020 [7]. - The company has consistently increased its monthly dividend, including during the pandemic, with a current annual dividend of nearly $3.23 per share, resulting in a dividend yield of 5.5%, significantly higher than the S&P 500 average of 1.2% [8]. Group 2: Financial Performance - In the first half of 2025, Realty Income reported revenue of $2.8 billion, reflecting a 7% increase compared to the same period in 2024, while expenses grew by 6%, with interest payments rising by 13% [9]. - The company achieved nearly $447 million in net income attributable to common shareholders in the first two quarters of 2025, marking a 16% year-over-year increase despite higher interest rates [10]. - Realty Income's funds from operations (FFO) for the trailing 12 months exceeded $3.65 billion, resulting in a price-to-FFO ratio of just under 15, which could enhance its attractiveness in a declining interest rate environment [11]. Group 3: Market Outlook - A widely expected interest rate cut in September, with a 95% probability according to futures traders, could serve as a catalyst for Realty Income's stock recovery [4]. - Treasury Secretary Scott Bessent speculated that the rate cut could be as high as 0.5%, which is more than the previously anticipated 0.25% [5]. - If the forecasted interest rate cut occurs, Realty Income may have increased capacity to refinance debt and pursue property acquisitions, potentially boosting profits and accelerating stock price recovery [14].

Core Insights - The Dow Jones Industrial Average and S&P 500 reached new record highs, driven by UnitedHealth Group's significant stock gain following Berkshire Hathaway's investment [1][4]. Company Insights - UnitedHealth shares surged over 9% at market open, marking the largest single-day gain since November 4, 2020, when it rose by 10.3% [4]. - Berkshire Hathaway acquired more than 5 million shares of UnitedHealth in June, valued at approximately $1.6 billion, making it the 18th-largest position in Berkshire's portfolio [5]. - Scion Asset Management, led by Michael Burry, also increased its stake in UnitedHealth, indicating growing interest from prominent investors [5]. Market Context - The broader market's performance is supported by optimism regarding potential interest rate cuts by the Federal Reserve, following recent inflation data [10]. - The CBOE Volatility Index (VIX) has decreased to its lowest levels this year, suggesting reduced market uncertainty [10].

Market Overview - The stock market is expected to remain volatile due to high stock prices relative to historical averages and uncertainties surrounding interest rate cuts and tariffs [1] - The Federal Reserve is uncertain about the impact of tariffs on inflation, which may affect the timing and magnitude of potential rate cuts [1] Investment Opportunities - Stocks such as Vipshop Holdings Limited (VIPS), Stride Inc. (LRN), HSBC (HSBC), and Futu Holdings Limited (FUTU) are highlighted as potential investment opportunities due to their growth strategies and resilience in uncertain market conditions [2][9] Stock Characteristics - Beta is used to measure the volatility of a stock compared to the market, with a beta of 1 indicating movement in line with the market, greater than 1 indicating higher volatility, and less than 1 indicating lower volatility [3][4] - A screening criterion for selecting stocks includes a beta between 0 and 0.6, ensuring lower volatility than the market, along with positive price movement over the last month, substantial trading volume, and a price of at least $5 [5][6] Company Insights - **Vipshop Holdings**: Utilizes a unique strategy called "Made for Vipshop," offering exclusive products from over 200 brands, which drives customer loyalty [7] - **Stride Inc.**: Focuses on innovative educational solutions and is well-positioned for long-term success due to increasing demand for school choice and tutoring services [10] - **HSBC**: Investing in growth areas by opening new wealth management centers in key locations and simplifying processes for small and medium-sized enterprises [11] - **Futu Holdings**: A tech-driven company enhancing online investing experiences with upgrades like the Futubull AI, which provides quick and accurate investment-related assistance [12]

Economic Overview - U.S. stocks have experienced a rally due to impressive economic data, leading to optimism among investors regarding potential Federal Reserve interest rate cuts [1][8] - Expectations for a rate cut in September increased after inflation data showed a slower-than-expected rise [2][8] Inflation Data - The consumer price index (CPI) rose 0.2% month-over-month in July, lower than the consensus estimate of 0.3% [4] - Year-over-year, CPI increased by 2.7% in July, also below the expected 2.8% [5] - Core CPI, excluding food and energy, rose 0.3% in July, aligning with expectations, while year-over-year core CPI increased by 3.1%, slightly above the 3% forecast [5][6] Consumer Discretionary Stocks - Investing in consumer discretionary stocks is recommended due to the favorable economic outlook and anticipated rate cuts [2][11] - Notable consumer discretionary stocks include: - **The Walt Disney Company (DIS)**: Expected earnings growth rate of 17.7% for the current year, with revenues of $91.4 billion in fiscal 2024 [9][10] - **Carnival Corporation & plc (CCL)**: Expected earnings growth rate of 40.9% for the current year [12][13] - **Hasbro, Inc. (HAS)**: Expected earnings growth rate of 19.5% for the current year [14] - **Netflix, Inc. (NFLX)**: Expected earnings growth rate of 31.4% for the current year [15][16] - **Ralph Lauren Corporation (RL)**: Expected earnings growth rate of 19.8% for the current year [17]

Group 1: Market Trends - Small-cap stocks, represented by the Russell 2000, gained over 1% in midday trading, contrasting with the S&P 500, which remained relatively unchanged due to major technology stocks [2][4] - The Russell 2000 has increased more than 4% this week, indicating it is on track for its best week since May [3] - The CNBC Magnificent 7 Index, tracking seven megacap technology companies, lost 0.3% after reaching a 52-week high earlier in the day [1] Group 2: Federal Reserve Expectations - Investors are increasingly confident that the Federal Reserve will cut interest rates at its upcoming meeting on September 16-17, which would particularly benefit small companies reliant on borrowed capital [4][5] - Interest rate futures traders are pricing in a nearly 100% likelihood of a rate cut from the current 4.35% to a range of 4.50% at the September meeting, a significant increase from less than 60% a month ago [5] - A growing number of economic and political voices are advocating for rate cuts, especially following weaker-than-expected job growth and a cooler-than-expected consumer inflation report [6] Group 3: Political Influence - President Trump and his allies have criticized Fed Chair Jerome Powell's rate policy, urging the Federal Open Market Committee to ease monetary policy [8] - Treasury Secretary Scott Bessent suggested that the Fed should lower rates by at least 1.5 percentage points, proposing a 50 basis point cut in September [9] Group 4: Performance Comparison - Despite recent gains, small caps have underperformed compared to larger stocks, with the Russell 2000 advancing less than 26% since the introduction of the ChatGPT app in late 2022, while the S&P 500 has climbed 64% during the same period [10]

Economic Outlook - Pre-market futures are up following all-time closing highs from the S&P 500 and Nasdaq, driven by optimism around potential rate cuts by the Federal Open Market Committee (FOMC) [1] - U.S. Treasury Secretary suggested a 50 basis points cut in the Fed funds rate, which would lower rates to 3.75-4.00%, a level last seen in December 2022 [2][1] - July Inflation Rate reported at +2.7%, alleviating concerns about tariffs re-igniting inflation [2] Inflation and Price Trends - Current inflation is below +2.0%, with sub-3.0% inflation expected to be absorbed by the economy without significant disturbance [3] - Concerns arise about potential inflation increases if interest rates decrease while tariffs rise, with projections of 2-3 rate cuts leading to a Fed funds rate of 3.50-3.75% amid rising inflation [4] - Recent CPI report showed food prices steady, gasoline down -9.5%, and used cars and trucks up +4.8%, indicating a core CPI at a 5-month high [4] Producer Price Index (PPI) Expectations - Upcoming PPI report for July is projected to show +0.2% on headline and +0.3% on core, indicating potential tariff effects before retailers adjust prices [5] Company Earnings - Brinker International (EAT) reported fiscal Q4 earnings of $2.49 per share, exceeding expectations and showing significant growth from $1.61 per share year-over-year [6] - Revenues of $1.46 billion surpassed estimates by +2%, with a +16% growth in restaurant traffic [7] - Maggiano's Little Italy franchise saw a slight decline of -0.4%, but Chili's experienced exceptional growth of +24% year-over-year [7] Market Expectations - Cisco Systems (CSCO) is expected to report earnings after the closing bell, with shares up +20% year-to-date and projected earnings growth of +11.5% year-over-year [8]

Market Overview - Major indexes on Wall Street have reached multiple all-time closing highs recently, but have experienced volatility due to uncertainties surrounding President Trump's new tariffs and potential inflation increases [1][4] - The ongoing volatility may persist as market participants are concerned about the economic impact of the tariffs and rising inflation [2][6] Dividend-Paying Stocks - Dividend-paying stocks are recommended as they tend to perform better during market volatility, providing a steady income stream and reducing the risk of sharp price swings [2][3] - Historically, companies that pay dividends have outperformed non-dividend-paying companies during periods of market instability [3] Specific Companies and Their Dividends - **Pan American Silver Corp. (PAAS)**: Announced a dividend of $0.12 per share with a yield of 1.25% and a payout ratio of 26%. The company has increased its dividend four times in the past five years [9][10] - **Carlisle Companies Incorporated (CSL)**: Declared a dividend of $1.10 per share with a yield of 1.09% and a payout ratio of 20%. The company has increased its dividend six times over the last five years [12][10] - **DHT Holdings, Inc. (DHT)**: Announced a dividend of $0.24 per share with a yield of 5.25% and a payout ratio of 56%. DHT has increased its dividend seven times in the past five years [14][10]

Core Viewpoint - The financial sector, particularly certain stocks like Berkshire Hathaway, Bank of America, and Wells Fargo, presents attractive investment opportunities despite being overshadowed by technology stocks [1][2][10]. Group 1: Company Valuations - Berkshire Hathaway has reached a market cap of $1 trillion, making it the largest financial company, with its core business in insurance and a significant stock portfolio valued at $300 billion [2][4]. - Bank of America reported a 7% year-over-year earnings growth and a 5% increase in customer deposits, indicating strong performance in a challenging consumer environment [5]. - Wells Fargo, now free from its asset cap, is positioned to benefit from falling interest rates, enhancing its consumer-focused business model [6][10]. Group 2: Market Conditions and Regulatory Environment - Both Bank of America and Wells Fargo could benefit from a potential reduction in corporate tax rates and a generally looser regulatory environment under the Trump administration [7]. - The financial sector is experiencing a shift, with interest rates expected to fall, which could positively impact banks like Bank of America and Wells Fargo [5][6]. Group 3: Comparisons with Other Financial Companies - JPMorgan Chase, while a strong institution, trades at a premium valuation compared to Bank of America and Wells Fargo, which may limit its attractiveness [8]. - Visa and Mastercard, despite being dominant players in the payment processing market, have high P/E ratios of 33 and 39, raising questions about their future growth potential [8].