Home prices have reached a new record high, with a 4% year-over-year increase. Low inventory levels and sustained high prices even in areas with increased listings where inventory remains 25% lower than pre-pandemic levels, which is propping up prices. Mortgage rates are currently around 6.8% and are expected to stay between 6.5% and 7.5%. The Federal Reserve projects one rate cut in 2024, likely in September, with more cuts in the year after that. Mortgage rates may drift down to the 6% range by Q4 2024 if September cuts become a reality. However, affordable housing remains a distant goal, requiring lower home prices, higher wages, and lower interest rates.

EQUITY

Stocks pulled back after a positive Monday as tech giants' earnings were closely monitored to gauge the buzz about a possible shift from megacaps to underdog sectors. Companies missing targets took a beating, while even strong performers saw limited gains. Energy stocks were the day's biggest losers as oil prices spiralled. Asian markets have also seen losses , tracking subpar earnings from Tesla and Alphabet.

GOLD

Gold prices edged up for the second day after taking a beating last week, retracing from an all-time high. India slashed gold import duties from 15% to 6%, potentially boosting jewellery manufacturing and demand for gold in the world's second-largest bullion consumer. The reasons behind this shift were rising smuggling, a lower deficit, and increased imports.

OIL
Oil prices are seeing hope after a woeful start to the week. Brent crude bounced back to around $81.5 per barrel after a four-day slump after barely reaching a fresh breakout level. This uptick was mainly due to a higher drawdown in U.S. oil stocks and ongoing wildfires in Canada threatening oil production. Traders are keeping an eye on the upcoming OPEC+ meeting, though no major changes are expected.

CURRENCY

The U.S. dollar showed a mixed picture, gaining overall with the dollar index reached a two-week high. but weakening against the yen. Comments from a Japanese politician about normalising monetary policy boosted the yen as well as suspected intervention behind the scene. The euro and pound declined against the dollar while China's surprise interest rate cuts negatively impacted the Australian and New Zealand dollars. These cuts were seen by some as a sign of economic desperation in China, possibly triggering a carry trade into the dollar.