5.6.24: Only 4 in 10 Renters Believe They Will be Homeowners

For Public Readers: Weekly Key U.S. and China brief market notes by Larry Cheung's Analyst Staff Team for our Public Email List

May 06, 2024

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In our emails, we will provide the following coverage points:

Brief Overview of U.S. & China Markets
Macro Chart in Focus
U.S. & China Upcoming Economic Calendar
Chart That Caught Our Eye

U.S and China Markets Brief Snapshot 🇺🇸 🇨🇳

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S&P 500 Index: 5158.33

KWEB (Chinese Internet) ETF: $30.50

Analyst Team Note:
Hedge funds shifted their stance on consumer stocks, reversing a four-week bearish trend and engaging in significant buying activity in consumer discretionary sectors.
Despite concerns raised by some major US food and restaurant companies missing earnings estimates, the buying activity reflects a reaction to lowered rate expectations rather than a sustainable trend.
Additionally, hedge funds continued to buy US equities overall, with net buying seen in health care, industrials, and information technology sectors, while communication services emerged as the most net sold sector.

Macro Chart In Focus

Analyst Team Note:
Citi is projecting that the Federal Reserve may prolong its balance sheet reduction program until the second quarter of 2025.
The bank cites the reinstatement of the federal debt ceiling in January 2025 as a key factor influencing the timing of the Fed's eventual halt to the unwind
The need for the Treasury to employ extraordinary measures to manage the ceiling could lead to a substantial drain in bank reserves, prompting the Fed to conclude its balance sheet reduction program.

Upcoming Economic Calendar

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U.S Economic Calendar (Upcoming Data Points)

China Economic Calendar (Upcoming Data Points)

Analyst Team Note:
A recent survey from the Federal Reserve found heightened pessimism among US renters regarding their prospects of homeownership, with only about four in 10 renters believing they will be able to purchase a home, the lowest level in the survey's decade-long history.
Particularly concerning is that half of younger renters, those under 50, now doubt their ability to buy a home. Three-quarters of renters indicated challenges in obtaining a mortgage compared to around half before the pandemic.
A significant proportion plan to stay put amid expectations of further increases in mortgage rates, reaching survey highs.