Stocks are flat this morning as the S&P is set to close out its best month since April. The 7% gain in August has left many investors wondering how much more the market can rise with so many skeletons in its closet. In an interview with CNBC, billionaire investor Leon Cooperman, talked about how much pent up demand the market in “pulling forward” from the shutdown that is inflating the market. This demand will not last; especially with the number of people and industries still on stimulus. Cooperman expects market returns to be “unimpressive for a long time”.
As building continues to boom, so does the price of lumber. Lumber prices are up 8% since last week and up 111% from last year! Like we addressed a couple weeks ago, lumber companies drastically reduces their capacity going into COVID because they expected a slowdown. However, new builds are the highest they have ever been and these constricted lumber companies cannot keep up. This is inflating the price of lumber and newly built homes.
Mortgage rates are flat this morning. They still have the threat of falling closer to their 50 day moving average so we will hold a locking bias.