Today's Scoop:

Hey friends - excellent work getting through Tuesday. You’re doing great.

Here’s what you need to know today…

1. Consumers are feeling a lot more confident about the economy.

2. Home prices are still rising.

3. New homes are selling fast.

S&P 500: 4,378.41
1Mo: +4% | 1Yr: +15% | 5Yr: +61%

The market drifted higher today due to some optimistic economic data and positive commentary from Delta Air Lines. Delta thinks the travel boom can keep going. Walgreens didn’t paint as rosy a picture of the consumer. [Scoop Below]

Americans are feeling good about the economy heading into summer. The Conference Board’s Consumer Confidence Index rose to the highest level in 18 months, far exceeding expectations. People are less worried about inflation and aren’t having trouble finding jobs. Many expect a recession, but not necessarily a bad one. Consumer spending powers two-thirds of the economy, so our feelings matter.

Home prices keep climbing. The S&P CoreLogic Case-Shiller national home price index rose in April for the third straight month. Despite the slowdown in the housing market from surging mortgage costs, average home prices are only down 2.4% from their June 2022 all-time highs.

New homes are selling fast because no one’s selling their existing home. The Commerce Department said the number of new single-family home sales surged 12% in May to the highest level in eighteen months. New homes are only a fraction of the market, but sales are up 20% in the past year. Existing home sales are down over 20% from a year ago as homeowners try to hang on to their cheaper mortgages.

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

• Eli Lilly reveals another weight-loss therapy breakthrough

• Robinhood slashes more staff

• Snowflake teams up with Nvidia for cloud AI

• Lucid Motors lands a huge deal to supply Aston Martin

• Walgreens warns of shrinking profits as shoppers conserve [🤓]

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

Earnings Guidance

One of the most critical components of corporate financial reports is the guidance. Public companies must report on their financial health each quarter, releasing standardized metrics on their sales, expenses, debt, profit, etc. All of that information, though, is backward-looking. Investors are buying a company for its future earnings.

Companies often “issue guidance” or provide projections for future sales and earnings. This gives investors a sense of optimism or pessimism from the people who know the company the best. Forecasted metrics are not required, so many companies have often avoided making projections over the past couple of years, given the unprecedented economic events. If they do report, you'll hear that they may have raised or lowered guidance, meaning they expect higher or lower profit/sales/whatever than they projected last time. You might also hear guidance compared to Wall Street Analysts' projections or estimates.

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