Today's Scoop:

Hey friends - Markets are closed on Monday for the Memorial Day holiday. Expect a Weekly Scoop tomorrow, and then we’ll be back with your regularly scheduled scoops on Tuesday. Enjoy the weekend!

Here’s what you need to know today…

1. Layoffs have been low this month.

2. Home sales have stalled.

3. The economy started the year off slowly.

S&P 500: 4,151.28
1Mo: +2% | 1Yr: +2% | 5Yr: +52%

The market floated higher today on optimism for a debt ceiling deal and a new AI-driven tech boom thanks to Nvidia. Check the scoop below.

Layoffs have been low this month. The Labor Department reported initial jobless claims ticked up slightly to 229,000 last week but also revised numbers from earlier in the month downward. Apparently, the big spike in layoffs a couple of weeks ago was driven by fraud. Officials revised the layoff count for two weeks through May 13 downward by a combined 50,000 claims. Massachusetts found 171,000 false claims over three months. Weekly layoffs are still at or below pre-pandemic averages.

Home sales have stalled. The National Association of Realtors reported pending home sales stayed flat in April at the lowest level since December. Low home supply and low affordability have scared away buyers.

US economic growth slowed in the first three months of the year. The Commerce Department reported real gross domestic product rose at an annualized rate of 1.3% in the first quarter, slower than the 2.6% growth rate for the fourth quarter.[🤓] Consumer spending, which powers about two-thirds of the economy, stayed pretty strong, despite higher living costs. Businesses invested in less equipment and machinery. Spending on home construction continues to slump.

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• Nvidia proves the AI demand is real

• Royal Caribbean cruises are jam-packed

• Palantir ramps up its AI support in Ukraine

• Boeing dials up safety prevention after crashes

• Best Buy struggles with shopper cutbacks

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Gross Domestic Product (GDP)

Gross Domestic Product (GDP) is how we track how much stuff the economy is producing. The actual number (~$26 trillion) doesn't matter as much as the direction and magnitude. We track the growth rate of real GDP (inflation-adjusted) to know whether the economy is expanding or contracting from the previous quarter.

The reporting style can be a bit confusing. The main number you hear will be an annualized growth rate (+1.3%), representing how much the GDP would increase/decrease if the economy hypothetically grew at that rate for an entire year. It's different from how much our production increased/decreased quarter-to-quarter (+0.3%) and not representative of the growth/decline over the past year (+1.6%). Annualizing the past quarter’s change makes the backward-looking number a little more forward-looking.

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