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Stock market news live updates: Stocks extend losses as inflation, interest rate worries persist – Yahoo Canada Finance

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U.S. stocks dropped in early trading Thursday as investors digested red-hot inflation data that showed price levels remained elevated in April, signaling more aggressive inflation-fighting efforts by the Federal Reserve may be underway.

The S&P 500 tumbled 1% after the index settled at 3,935.18, or its lowest level since March 2021 in the previous session. The S&P 500 is down more than 17% in the first 90 trading days of 2022, marking its second worst start to a year, according to data from Compound Capital Advisors. The Dow Jones Industrial Average shed 250 points, or 0.8%, and the Nasdaq Composite plunged 1.7%.

The moves build on a streak of sharp losses in equity markets and follow April’s Consumer Price Index (CPI) out Wednesday, which showed an inflation rate that held near a 40-year high despite a marginal pullback from the prior month. Furthermore, the so-called core price index, which excludes the volatile food and energy categories, came in higher than economists had anticipated, stoking worries among investors that elevated prices may persist.

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April’s snapshot of inflation across the U.S. comes as investors gauge how aggressively the Federal Reserve will intervene to rein in rising price levels via monetary tightening, including increases on interest rates. Uncertainty around the central bank’s next move has spurred turbulence across risk assets, sending all three major indexes to their lowest trading levels year-to-date.

“Inflation appears to be entrenched within many areas of the economy and regardless if we have witnessed inflation peak, a persistently slow grind lower will be more problematic for the Fed to simultaneously cool inflation without tipping the economy into recession,” Charlie Ripley, a senior investment strategist at Allianz Investment Management, said in an emailed note Wednesday.

Cleveland Fed President Loretta Mester told Yahoo Finance on Tuesday that interest rate hikes of 50 basis points were likely in the next two Federal Reserve policy-setting meetings, while leaving an increase of 75 basis points on the table as the central bank ramps up its inflation-mitigation efforts.

“It’s going to be challenging, no doubt, because there are things going on on both the supply side and the demand side,” Mester said. “But the risks to inflation remaining high get even more risky as we keep going because of inflation expectations, so it’s really important we’re committed to doing what we need to do.”

Peter Essele, head of portfolio management, Commonwealth Financial Network, said if inflation levels out in the second half of the year, there will be less pressure on the Fed to combat elevated price levels with aggressive monetary policies, “which leaves open the possibility of a soft landing of the economy as opposed to the crash and burn that markets have been pricing in as of late.”

“The second half of the year could be a strong period for equities and bonds if inflation continues to moderate and the magnitude of interest rate hikes come in under expectations,” Essele said in a note. “Currently, investors are pricing in a doomsday scenario with inflation and are missing the forest for the trees.”

9:30 a.m. ET: S&P 500 falls 1%, Dow sheds 250 points, Nasdaq tumbles 1.7%

Here were the main moves in markets at the opening bell on Thursday:

  • S&P 500 (^GSPC): -31.73 (-0.81%) to 3,903.45

  • Dow (^DJI): -168.41 (-0.53%) to 31,665.70

  • Nasdaq (^IXIC): -136.71 (-1.20%) to 11,227.52

  • Crude (CL=F): +$0.10 (+0.09%) to $105.81 a barrel

  • Gold (GC=F): -$7.10 (-0.38%) to $1,846.60 per ounce

  • 10-year Treasury (^TNX): -7.8 bps to yield 2.8430%

9:15 a.m. ET: US producer prices extend climb as inflationary pressures persist

Wholesale inflation rose again in April in a sign elevated consumer prices may continue for longer than expected.

The producer price index for final demand climbed 11% from April of last year and 0.5% on a monthly basis, driven by higher costs for goods, according to Labor Department data released Thursday. That figures also follow notable upward revisions to the March figures.

“Producer price inflation slowed slightly in April but still remains historically high, with nothing to dissuade the Federal Reserve from more rate hikes in the April inflation numbers,” Comerica Bank Chief Economist Bill Adams said in a note. “The Fed will want to see clearer evidence that inflation is cooling and higher interest rates are slowing demand before they start thinking about the endpoint of the current rate hike cycle.”

The so-called core PPI, which excludes the volatile food and energy components, rose 0.4% from a month earlier and was up 8.8% from the same period last year. The measure rose at a softer-than-expected monthly pace but March’s figure was revised up to a 1.2% advance.

9:07 a.m. ET: New jobless claims unexpectedly rise but remain near 200,000 level

Applications for first-time unemployment filings unexpectedly rose in the latest weekly data but remained near pre-pandemic lows, as a strong labor market and improving levels of unemployment remain a bright spot in the U.S. economy.

The Labor Department’s latest weekly jobless claims report showed 203,000 claims were filed in the week ended May 7, coming in below the 192,000 economists surveyed by Bloomberg had expected.

“It’s probably unrealistic to expect it to fall much below 200,000,” Ted Rossman, senior industry analyst at Bankrate said in a note. “Broadly speaking, the job market is still a source of strength in an economy riddled with worries about inflation, higher interest rates and more.”

Given the surge and then decline in jobless claims, the Labor Department has also now reconfigured the way it adjusts the weekly data to account for seasonal factors. Starting last week, the Labor Department returned to using “multiplicative” seasonal adjustment factors for the data. For much of the pandemic, the department had been using “additive” seasonal adjustments that help smooth out large swings in the weekly numbers.

The 4-week moving average was 192,750, an increase of 4,250 from the previous week’s revised average, according to the Labor Department’s release.

7:15 a.m. ET: Futures decline as sell-off persists amid inflation, interest rate worries

Here were the main moves in early futures trading Thursday ahead of market open:

  • S&P 500 futures (ES=F): -16.00 (-0.41%) to 3,914.25

  • Dow futures (YM=F): -90.00 (-0.28%) to 31,653.00

  • Nasdaq futures (NQ=F): -90.25 (-0.75%) to 11,879.50

  • Crude (CL=F): -$1.35 (-1.28%) to $104.36

  • Gold (GC=F): -$6.80 (-0.37%) to $1,846.90 per ounce

  • 10-year Treasury (^TNX): 0.00 bps to yield 2.9210%

6:30 a.m. ET: Grocery delivery platform Instacart files for IPO

Instacart Inc., the largest online grocery delivery service in the U.S., has confidentially filed documents for an initial public offering, according to a Bloomberg News report.

The company is reportedly working with banks including Goldman Sachs Group Inc. and JPMorgan Chase & Co. on the move, per Bloomberg, citing people familiar with the matter, who indicated a listing could happen as soon as this year, though the timing may change.

Instacart, which grew sharply during the pandemic as people turned to online grocery shopping, has seen a recent slowdown in growth following its COVID boom as consumers return to in-person supermarket visits.

The company revealed in March that it was cutting its valuation about 40% to $24 billion. Instacart was previously valued at $39 billion in a March 2021 funding round from firms including Andreessen Horowitz, Sequoia Capital and D1 Capital Partners, as well as Fidelity Management & Research Co. and T. Rowe Price Associates Inc, Bloomberg reported.

Smartphone with displayed Instacart logo is seen in this illustration taken March 25, 2022. REUTERS/Dado Ruvic/IllustrationSmartphone with displayed Instacart logo is seen in this illustration taken March 25, 2022. REUTERS/Dado Ruvic/Illustration

Smartphone with displayed Instacart logo is seen in this illustration taken March 25, 2022. REUTERS/Dado Ruvic/Illustration

6:14 p.m. ET Wednesday: Stock futures edge higher following continued losses in equities

Here’s where stock futures were in extended trading ahead of the overnight session Wednesday:

  • S&P 500 futures (ES=F): +10.75 (+0.27%) to 3,941.00

  • Dow futures (YM=F): +76.00 (+0.24%) to 31,819.00

  • Nasdaq futures (NQ=F): +30.50 (+0.25%) to 12,000.25

  • Crude (CL=F): +$0.02 (+0.02%) to $105.73

  • Gold (GC=F): -$1.90 (-0.10%) to $1,851.80 per ounce

  • 10-year Treasury (^TNX): -7.2 bps to yield 2.9210%

A trader works on the floor of the New York Stock Exchange NYSE in New York, the United States, May 5, 2022. U.S. stocks plunged on Thursday as heavy selling intensified on Wall Street.   The Dow Jones Industrial Average tumbled 1063.09 points, or 3.12 percent, to 32,997.97. The S&P 500 fell 153.30 points, or 3.56 percent, to 4,146.87. The Nasdaq Composite Index shed 647.17 points, or 4.99 percent, to 12,317.69. (Photo by Michael Nagle/Xinhua via Getty Images)A trader works on the floor of the New York Stock Exchange NYSE in New York, the United States, May 5, 2022. U.S. stocks plunged on Thursday as heavy selling intensified on Wall Street.   The Dow Jones Industrial Average tumbled 1063.09 points, or 3.12 percent, to 32,997.97. The S&P 500 fell 153.30 points, or 3.56 percent, to 4,146.87. The Nasdaq Composite Index shed 647.17 points, or 4.99 percent, to 12,317.69. (Photo by Michael Nagle/Xinhua via Getty Images)

A trader works on the floor of the New York Stock Exchange NYSE in New York, the United States, May 5, 2022. U.S. stocks plunged on Thursday as heavy selling intensified on Wall Street. The Dow Jones Industrial Average tumbled 1063.09 points, or 3.12 percent, to 32,997.97. The S&P 500 fell 153.30 points, or 3.56 percent, to 4,146.87. The Nasdaq Composite Index shed 647.17 points, or 4.99 percent, to 12,317.69. (Photo by Michael Nagle/Xinhua via Getty Images)

Alexandra Semenova is a reporter for Yahoo Finance. Follow her on Twitter @alexandraandnyc

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Calgary breaks all-time record in housing starts but increasing demand keeps inventory low – CBC.ca

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Soaring housing demands in Calgary led to an all-time record for new residential builds last year, but inventory levels of completed and unsold units remained low due to demand outpacing supply.

According to the latest report from Canada Mortgage and Housing Corporation (CMHC), total housing starts increased by 13 per cent in Calgary, reaching a total of 19,579 units with growth across all dwelling types in the city.

That compares to a decline of 0.5 per cent overall for housing starts in the six major Canadian cities surveyed by CMHC.

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Calgary also had the highest housing starts by population.

“Part of the reason why we think that might have happened is that developers are responding to low vacancies in the rental market,” said Adebola Omosola, a housing economics specialist with CMHC.

“The population of Calgary is still growing, a record number of people moved here last year, and we still expect that to remain at least in the short term.”

Earlier this year, the Calgary Real Estate Board also predicted that demand, especially for rental apartments, wouldn’t let up any time soon. 

Industry can cope with demand, expert says

According to numbers from the report, average construction times were higher in 2023 for all dwelling types except for apartments.

The agency’s report suggests the increase in the number of under-construction residential projects might mean builders are operating at or near full capacity.

However, there’s optimism the construction industry can match the increasing need.

Brian Hahn, CEO of BILD Calgary Region, said despite concerns around about construction costs, project timelines and labour shortages, the industry has kept up with the demand for new builds.

Demand is expected to remain robust, but the construction industry can keep up, according to BILD Calgary region CEO Brian Hahn.
Demand is expected to remain robust, but the construction industry can keep up, according to BILD Calgary Region chief executive officer Brian Hahn. (Shaun Best/Reuters)

“I’ve heard that kind of conversation at the end of 2022 and I heard it in 2023,” Hahn said.

“Yet here we are early in 2024, and January and February were record numbers again.”

Hahn added he believes the current pace of construction will continue for at least the next six months and that the industry is looking at initiatives to attract more people to the trades.

Increase in row house and apartment construction

Construction growth was largely driven by new apartment projects, making up almost half of the housing starts in Calgary in 2023.

The federal housing agency says 9,034 apartment units were started that year, an increase of 17 per cent from the previous year. Of those, about 54 per cent were purpose-built rentals.

Apartments made up around two-thirds of all units under construction, CMHC said, with the total number of units under construction reaching 23,473.

Growth, however, was seen across all dwelling types. Row homes increased by 34 per cent from the previous year while groundbreaking on single-detached homes grew by two per cent.

“Notwithstanding challenges, our members and the industry counterparts that support them managed to produce a record amount of starts and completions,” Hahn said.

“I have little doubt that the industry will do their very best to keep pace at those levels.”

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Ottawa real estate: House starts down, apartments up in 2023 – CTV News Ottawa

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Rental housing dominated construction in Ottawa last year, according to a new report from the Canada Mortgage and Housing Corporation (CMHC).

Residential construction declined significantly in 2023, with housing starts dropping to 9,245 units, a 19.5 per cent decline from the record high observed in 2022. But while single-detached and row housing starts fell compared to 2022, new construction for rental units and condominiums rose.

“There’s been a shift toward rental construction over the past two years. Rental housing starts made up nearly one third of total starts in 2023, close to double the average of the previous five years,” the report stated.

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Apartment starts reached their highest level since the 1970s.

“The trend toward rental and condominium apartment construction follows increased demand in these market segments due to population growth, households looking for affordable options, and some seniors downsizing to smaller units,” the CMHC said.

Demand from international migration and students, the high cost of home ownership, and people moving to Ottawa from other parts of Ontario were the main drivers for rental housing starts in 2023. The CMHC says rental and condominium apartment starts made up 63 per cent of total starts in 2023, compared to the average of 37 per cent for the period 2018-2022.

There was a modest increase in rental housing starts in 2023 over the record-high seen the year prior and a jump in new condominiums. The report shows 5,846 new apartments were built in Ottawa last year, up 2.1 per cent compared to 2022.

Housing starts in Ottawa by year. (CMHC)

Big demand for condos

The CMHC said condo starts reached a new high in 2023, increasing 3 per cent from 2022 numbers.

“As of the end of 2023, there were only 13 completed and unsold condominium units, highlighting continued demand for new units,” the CMHC said.

Condominum starts increased in areas such as Chinatown, Hintonburg, Vanier and Alta Vista, as well as some suburban areas like Kanata, Stittsville, and western Orléans. Condo apartment construction declined in denser parts of the city like downtown, Lowertown and Centretown, the report says.

Taller buildings are also becoming more common, as the cranes dotting the skyline can attest. The CMHC notes that buildings with more than 20 storeys accounted for nearly 10 per cent of apartment structure starts in 2022 and 2023, compared to an average of 2 per cent over the 2017-2021 period. The number of units per building also rose 7 per cent compared to 2022.

Apartment building heights in Ottawa by year. (CMHC)

Single-detached home construction down significantly

The number of new single-detached homes built in Ottawa last year was the lowest level seen in the city since the mid 1990s, CMHC said.

“The Ottawa area experienced a slowdown in residential construction in 2023, driven by a significant decline in single-detached and row housing starts,” the CMHC said.

Single-detached housing starts were down 45 per cent compared to 2022. Row house starts dropped by 38 per cent compared to 2022, marking a third year of declines in a row.

“Demand for single-detached and row houses also declined in 2023. Higher mortgage rates and home prices have led to a shift in demand toward more affordable rental and condominium units,” the report said.

There were 1,535 single-detached housing starts in Ottawa last year, 208 new semi-detached homes and 1,678 new row houses.

The majority of single-detached and row housing starts were built in suburban communities such as Barrhaven, Stittsville, Kanata, Orléans and rural parts of the city.

“Increased construction costs resulting from higher financing rates and inflation that occurred in 2022 and 2023 contributed to the decline in construction in the region,” the CMHC said. 

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Trump’s media company ticker leads to fleeting windfall for some investors

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A man looks at a screen that displays trading information about shares of Truth Social and Trump Media & Technology Group, outside the Nasdaq Market site in New York City, U.S., March 26.Brendan McDermid/Reuters

Possible confusion over the new stock symbol for former President Donald Trump’s Truth Social (DJT-Q) saw some investor brokerage balances briefly jump by hundreds of thousands of dollars on Tuesday, the first day Trump’s “DJT” ticker traded.

Several people complained on social media about briefly seeing the value of their DJT stock holdings on Charles Schwab platforms inflated to figures more in line with what they would be worth if the shares traded at the level of the Dow Jones Transportation Average.

Some users said they faced a similar issue in pre-market hours on Morgan Stanley’s E*Trade trading platform.

Shares of Trump Media & Technology Group opened Tuesday at $70.90, while the Dow Jones Transportation Average started the session at 15,937.73 points.

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For one trader, the Schwab brokerage balance jumped by more than $1 million due to the error, according to a screen grab shared on social media platform X. Reuters was unable to contact the trader or independently verify the brokerage balance.

“It sure was nice seeing millions in the account, even if it wasn’t real,” another person, going by the username @DanielBenjamin8, who faced the issue in his E*Trade account, posted on X.

Two X users and one on Reddit surmised that the inflated balances were due to the ticker symbol for the company being nearly identical to the index.

A spokeswoman for Charles Schwab said that certain users on some of Schwab’s trading platforms saw their brokerage balances briefly inflated due to a technical issue.

The issue has been resolved and investors are able to trade equities and options on Schwab platforms, she said. Schwab declined to describe the exact cause of the issue.

E*Trade did not immediately respond to a request for comment outside of regular business hours.

Trump Media & Technology Group and S&P Dow Jones Indices, which maintains the Dow Jones Transportation Average Index, did not immediately comment on the issue.

While social media users said the issue appeared to have been resolved, many rued not being able to cash out their supposed gains from the error.

“I better go tell my boss that I’m actually not retiring,” the trader whose account balance had briefly jump by more than $1 million, wrote on X.

Trump Media & Technology Group shares surged more than 36% on Tuesday in their debut on the Nasdaq that comes more than two years since its merger with a blank-check firm was announced.

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