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Daily Scoop 22-1-19

Daily Scoop 22-1-19

👋 Your Wednesday Scoops - Exxon's net-zero shocker & Bankers get paid

January 19, 2022

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Today's Scoop:Shaky

Big Picture

Mortgage rates are rising.
People are borrowing bigger amounts due to rising home prices.
Home construction is picking back up.

The Market

⬇️

-1.0%

S&P 500: 4,532.76

1Mo:

-1%

| 1Yr:

+18%

| 5Yr:

+100%

Markets wobbled downward again today. We're about a week into fourth-quarter corporate updates, and

solid earnings reports

haven't been enough to distract investors from their

worries about rising interest rates.

Investors are rotating away from their high-growth stocks.

The Commerce Department reported an increase in housing permits and starts in December, indicating a

pickup in home construction that might ease some of the high prices due to low supply

. The Mortgage Bankers Association reported the

average mortgage amount hit a record

, as the average amount borrowed rose to $418,500.

Mortgage rates continue to increase

, now at the highest level since March 2020.

Company Scoops ❤🌎💰

(Click to dig in & vote your reaction, see how others feel)

Exxon

makes its first big net-zero commitment

Microsoft's

dumping Activision's CEO

Procter & Gamble's

racking up prices

Goldman Sachs

gives bankers a 33% pay bump

Bank of America's

record profits

(These links only work for 24 hours while the story is live)

🤓 Inside Scoop...

In the short term, the rise and fall of stock prices are driven by themes. These themes are engrained in investors' minds, and they act like a herd migrating by the season. For instance, when the herd is worried about higher interest rates, they sell their growth stocks and rotate more into stable companies. In theory, that's because less profitable or unprofitable companies have to borrow more for their businesses to support their growth, and also because it means you can get higher income from safer investments like bonds. But if in three months the market isn't as worried about higher rates, the cycle could likely reverse right back.