Tuesday's Scoop: Hope 🌤️

Hey friend - welcome back to your daily scoops on the economy and companies impacting your life.

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

1. Small business owners are more pessimistic than ever.

2. Baltimore’s port has been cleared, and trade has been restored.

3. Homeownership costs have soared over the past few years.

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

Baltimore's main shipping channel has fully reopened following the March 26 collapse of the Francis Scott Key Bridge, which had severely disrupted port operations. This critical reopening allows the Port of Baltimore, a major hub for cars and farm equipment, to resume normal operations. The closure had ripple effects, delaying shipments and pushing traffic to other East Coast ports, which increased costs and logistical challenges. The shutdown's economic impact was significant, costing an estimated $15 million daily. The port’s return to full capacity will help stabilize supply chains, reduce costs, and restore thousands of jobs affected by the disruption. Baltimore hopes to rebuild the bridge by 2028.

Pessimism among small business owners has been the strongest in 50 years, driven by persistent inflation and high borrowing costs. The National Federation of Independent Business' Small Business Optimism Index rose slightly in May from a 12-year low in March and remained below its historical average for the 29th consecutive month. Inflation remains the top concern for business owners, while high interest rates have made borrowing more challenging. The upcoming US presidential election has also increased uncertainty, adding to the pessimism.

30yr Mortgage Rate: 7.1%
^{That’s up from 6.9% a year ago. (MBA)}
Median Home Price: $407,600
^{That’s up from $386K a year ago. (NAR)}

The cost of owning a home in the US has surged 26% since the pandemic began, driven by rising taxes, insurance, and maintenance expenses. According to an analysis from Bankrate, homeowners now face an average annual outlay of $18,118, excluding mortgage payments. This increase translates to about $300 more monthly compared to March 2020. While rising mortgage rates have grabbed headlines, the spike in ownership costs is a significant burden on homeowners, with maintenance and property taxes contributing the most to the rise. States like Utah and Idaho have seen the steepest increases, highlighting the broader economic impact on homeownership affordability.

The Market: ⬆️ +0.3%
S&P 500: 5,375.32
1Mo: +3% | 1Yr: +24% | 5Yr: +86%

The market drifted to a new record high on Tuesday as investors grew optimistic about the May inflation report due Wednesday. Apple's rising stock also helped pull the broader market higher as investors celebrated its new AI features that will force consumers to buy new phones.