REAL ESTATE
New-home sales nationwide unexpectedly tumble to lowest level since June
New-home sales in the United States dropped to a five-month low, suggesting red-hot demand is cooling amid resurgent COVID-19 cases and other signs of a slowing economy. Purchases of new single-family houses decreased 11 percent to an 841,000 annualized pace in November from a downwardly revised 945,000 rate in the prior month, government data showed Wednesday. The median projection in a Bloomberg survey of economists called for 995,000. The median selling price rose 2.2 percent from a year earlier to $335,300. The data dim housing’s status a bit as a bright spot in an otherwise shaky economy, and the drop in sales may reflect a lack of available inventory as builders struggle to meet demand fueled by ultra-low mortgage rates. Affordability could also be playing a role, though a new $900 billion stimulus package, approved by Congress on Monday, may boost family finances and keep demand robust. A report Tuesday showed that sales of previously owned homes also fell in November, as surging prices and a record-low supply constrain demand. Wednesday’s report showed the number of properties sold for which construction hadn’t yet started decreased to a four-month low of 288,000 in November, while the number of homes for sale edged up to 286,000. At the current sales pace, it would take 4.1 months to exhaust the supply, the highest since June. The drop in sales was concentrated in the West and Midwest regions. ― BLOOMBERG NEWS
FINANCIAL REGULATION
SEC chairman announces sudden resignation
US Securities and Exchange Commission chairman Jay Clayton announced Wednesday that it was his last day leading Wall Street’s top regulator. Clayton, in a statement posted on the agency’s website, said he submitted a letter to President Trump informing him of his decision to leave the SEC Wednesday. While President-elect Joe Biden will pick a permanent successor to Clayton, Trump will likely install either Hester Peirce or Elad Roisman — the SEC’s Republican commissioners — as acting chairman. Clayton, a former law partner at Sullivan & Cromell whose clients included prominent Wall Street firms, had previously announced that he planned to step down by the end of the year. ― BLOOMBERG NEWS
FINANCIAL
Low yields for money market funds prompt fee cut
Fidelity Investments has waived nearly $250 million in fees and expenses for its largest money market fund, a sign of how low yields pressured the products in an unprecedented year. Without the waivers, investors in the $212 billion Fidelity Government Money Market Fund would have faced negative yields on their holdings. Retail money market funds struggled this year as the US Federal Reserve tamped down interest rates because of the COVID-19 pandemic crisis, making it difficult to generate enough interest income to cover expenses and still pay shareholders. Fidelity spokesman Charlie Keller said the waivers reflect reductions across many of the fund’s expenses, not just management fees. He added that Fidelity is currently waiving fees on most money market funds to maintain positive yields. Fidelity Government’s net assets totaled $209 billion at the end of October, up from $143 billion a year earlier. But the fund’s interest income plummeted to $208 million, from $1.5 billion. ― BLOOMBERG NEWS
NEIGHBORLINESS
Bond King’s sitcom soundtrack silenced
Bill Gross’s enthusiasm for playing the theme to “Gilligan’s Island” loudly outside his Southern California oceanfront home was muted by a judge who agreed with the Bond King’s neighbor that it amounted to harassment and imposed strict limits on the billionaire. Orange County Superior Court Judge Kimberly Knill on Wednesday ordered Gross to stop playing sitcom theme songs and other loud music when they aren’t outdoors for three years and to stay at least five yards away from their next-door neighbors in Laguna Beach. Tech entrepreneur Mark Towfiq sought the restraining order to stop what he alleged was “a targeted campaign of harassment” that began after he complained to city officials that Gross installed unsightly netting over a million-dollar sculpture in his yard without proper permits. “The court finds the evidence demonstrates Gross and Schwartz willfully playing music to annoy or harass their neighbors,” Knill said. “The evidence demonstrates on Aug. 23, 2020, Gross and Schwartz manually started the playlist over and over again,” the judge said, pointing out that one 17-minute video from a camera in Towfiq’s property showed that “Gilligan’s Island” played eight times, as did “Green Acres.” ― BLOOMBERG NEWS
ENERGY
Air travel no help for oil markets
Even with air travel surging ahead of the Christmas holiday in the United States, demand for jet fuel is unlikely to recover to historic levels anytime soon. The spread between the price of jet fuel and crude oil, a rough gauge of how much a refinery can make for producing it, rose to $8 a barrel. That’s the highest since the pandemic forced most flights to be grounded but far below the roughly $21 margin a year ago. Domestic jet fuel demand is at its highest since April, according to US government data, but still half of levels a year earlier. Globally, the market has seen an uneven recovery. While China is now scheduling 10 percent more domestic flights than a year ago, other parts of the world are far behind, hobbling jet fuel consumption. — BLOOMBERG NEWS
TRANSPORTATION
Electric vehicles from GM on display at CES
General Motors chief executive Mary Barra plans to provide a peek of upcoming electric vehicles at the CES next month and bolster the automaker’s credentials as a rising power in EVs, according to people familiar with the matter. Barra will give the opening keynote address on Jan. 12 for the all-digital expo, formerly known as the Consumer Electronics Show. She plans to explain how electrification is a necessary step to address environmental and societal change. GM will also show a video at CES featuring its latest technology and preview concept vehicles, including a plug-in Chevrolet pickup, some Cadillac models, and vehicles for other brands. GM’s messaging blitz is designed to signal the company’s commitment to electrification and intent to take on EV market leader Tesla Inc. It’s unclear if Chevy’s electric pickup concept will share the Silverado nameplate with its gasoline-fueled cousin, but it will join an electric Hummer truck that will go on sale late next year in a hotly contested market for battery-powered trucks. GM also will lean on its premium Cadillac brand to lead the charge into electrics when its Lyriq crossover SUV goes on sale in 2022. — BLOOMBERG NEWS
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December 24, 2020 at 06:31AM
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Surprisingly, new home sales hit five-month low - BetaBoston
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