Monday's Scoop: Mixed 🌤️

Hey friend - hope you stayed cool this weekend.

Here’s what you need to know today to inform your work, spending, and investments…

1. Home prices keep rising to record highs, but more supply hit the market last month.

2. Business activity picked up in June.

3. Higher energy demands pushed fossil fuel pollution to a record high last year.

Unemployment Rate: 4.0%
^{Still near the lowest rate in 50+ years}

The economy showed signs of a rebound in June. S&P Global’s index of US business activity climbed to a 26-month high, driven by increased employment and new product and service orders. S&P’s Composite PMI Output Index, which tracks the manufacturing and services sectors, indicated optimism from business owners and a slowdown in cost increases. The report is a welcome sign of continued economic growth without accelerating inflation.

Global Energy Emissions: 37.4 billion tonnes of CO₂
^{An all-time high, up 1.1% from 2022. (IEA)}

The energy required to power civilization reached a new record in 2023, which meant record renewable energy use as well as record fossil fuel pollution. According to the industry's Statistical Review of World Energy report, global energy-related emissions reached a new high last year despite a massive shift to clean energy sources, as our increased electricity demands outmatched the pace of bringing wind and solar facilities online. Global fossil fuel use rose by 1.5%, but coal, gas, and oil made up a smaller percentage of the overall power mix than in 2022. As much as 74% of the overall net growth in power generation came from renewables, driven by higher wind and solar capacity. Since 2000, annual pollution from energy production has increased by 50%.

30yr Mortgage Rate: 7.0%
^{That’s up from 6.8% a year ago. (MBA)}
Median Existing Home Price: $419,300
^{That’s up from $397K a year ago. (NAR)}

Record-high home prices have stalled the market, but more houses are coming for sale. The National Association of Realtors reported a declining number of existing home sales for the third straight month in May as the median home price rose to a record high of $419,300. A nationwide housing shortage has kept prices from falling despite high mortgage costs and record prices. However, new home supply surged to the highest level in years last month as more resellers brought their homes onto the market. That could be a good sign for future price relief, as existing homes usually make up 80-90% of the supply. Entry-level homes are still in short supply. Most homes sold last month cost over $750,000, with 30% purchased above the asking price and 25% done in cash. The proportion of first-time buyers on the market has tumbled.

The Market: ⬇️ -0.3%
S&P 500: 5,447.87
1Mo: +3% | 1Yr: +26% | 5Yr: +85%

The market drifted lower on Monday as investors waited out the slow week of data before the end of the month and quarter. There are some encouraging signs that inflation may be under control, but economic growth is slowing.