NASDAQ 100, Dow Jones, S&P 500 News: Buffett’s Berkshire Backs Homebuilders

Highlights

• Berkshire Hathaway invests in homebuilders.
• Home Depot revenues expected to match the consensus estimates
• Market sees tech, semiconductor rebound.
• Investors await key Retail Sales data, Fed minutes.

Buffett’s Berkshire Bets on Homebuilders

The pre-market session has witnessed a dip in major US stock index futures. As of 09:12 GMT, futures tied to the S&P 500 were down 0.39%, while the Dow Jones Industrial Average futures dropped 0.47%.

Notably, amidst this decline, homebuilders D.R. Horton and Lennar saw a surge in their stocks, climbing 3% and 2%, respectively. This rise can be attributed to Warren Buffett’s Berkshire Hathaway disclosing new investments in these companies.

According to a regulatory filing, Berkshire Hathaway, under the stewardship of Warren Buffett, unveiled investments in homebuilders like D.R. Horton, Lennar, and NVR. This bold move comes during a time when rising interest and mortgage rates have dampened the demand for homebuilding and related businesses. However, Berkshire optimistically points out that the current low inventory of homes for sale has stimulated new construction activities, a scenario favorable for homebuilders.

As for specifics, as of June 30, Berkshire possessed 5.97 million DR Horton shares, 153,000 Lennar shares, and 11,112 NVR shares, valued at $726.4 million, $17.2 million, and $70.6 million respectively. Buffett’s reputation as an astute investor has led many to monitor and even mirror Berkshire’s investment moves closely.

Nvidia Soars on Morgan Stanley Recommendation

Meanwhile, in the broader market on Monday, a revival in the semiconductor and tech sectors aided the rise of the S&P 500 and Nasdaq Composite by 0.58% and 1.05% respectively. Noteworthy was Nvidia’s impressive 7.1% jump after Morgan Stanley’s nod as a top pick. Despite the market’s resilience after last week’s downturn, many on Wall Street are anticipating further consolidation, particularly as we approach the historically weak months of August and September.

Short-Term Outlook:  Guided by Treasury Yields; Home Depot to Report

U.S. Treasury yields showed an uptrend, with investors eagerly awaiting economic data releases, particularly those from major retailers like Home Depot. The company’s earnings report is not expected to surprise with investors saying revenues should match the consensus estimates

Further insights into the economy will be sought from upcoming reports, including July’s retail sales figures. Moreover, the forthcoming minutes from the Fed’s recent meeting are being eyed for hints on the economic trajectory and interest rates, following mixed messages post their July assembly.