🏠 Home sales rebound

and Gap reports earnings

In partnership with

Good morning investors! Bitcoin crossed $99,000 yesterday for the first time and $100k doesn’t look like a dream anymore.

Today we cover:

  • Home sales rebound in October

  • GAP reports earnigns

  • Tech takes a break

📊 Economy and News 

October Sees a Rebound in Home Sales as Mortgage Rates Dip

Home sales rebounded in October as a drop in mortgage rates drew buyers back to the market after a sluggish summer. Sales of previously owned homes rose 3.4% from September to an annualized rate of 3.96 million units, according to the National Association of Realtors. This marked a 2.9% increase from October last year, the first annual rise in over three years.

The uptick reflected contracts signed during August and September, when 30-year fixed mortgage rates fell from 6.6% to 6.11%, boosting buyer confidence.

Inventory remained tight, with 1.37 million homes available at the end of October, a 4.2-month supply—still below the balanced 6-month level. This scarcity pushed the median home price to $407,200, a 4% increase year-over-year. Higher-priced homes saw stronger activity than lower-priced properties.

Cash buyers accounted for 27% of sales, down slightly from last year, likely influenced by declining mortgage rates. First-time buyers remained underrepresented, making up just 27% of sales, well below the typical 40%.

While mortgage rates have since climbed back to 7.05%, Redfin reported a surge in buyer inquiries in mid-November, suggesting demand could remain resilient despite ongoing challenges.

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📈 Stocks

S&P 500 5,948.71 (+0.53%)
DJIA 43,870.35 (+1.06%)
NASDAQ 18,972.42 (+0.033%)
BRENT CRUDE 74.22 (-0.02%)
* Prices as of Nov 22nd, 12:20 AM UTC

Gap Overcomes Weather Challenges to Deliver Strong Results

Hurricanes and warm weather impacted Gap’s sales in the fiscal third quarter, but the company exceeded expectations and raised its annual guidance for the third time this year. Gap, which operates Old Navy, Banana Republic, Athleta, and its namesake brand, now expects fiscal 2024 sales to rise by 1.5% to 2%, surpassing prior estimates of slight growth.

  • Earnings per share: 72 cents (vs. 58 cents expected)

  • Revenue: $3.83 billion (vs. $3.81 billion expected)

Net income rose to $274 million, a significant improvement from $218 million a year earlier. Sales increased by 2% year-over-year despite weather-related challenges, including 180 store closures caused by hurricanes, which CEO Richard Dickson said affected Old Navy the most.

As weather conditions normalized, sales rebounded, and the holiday shopping season has started strong, positioning Gap for continued momentum.

The stock gained +6% yesterday during trading hours and +14% after the bell.

Tech falls: Nvidia shares rose 0.5% after better-than-expected third-quarter results and strong guidance, though initial declines reflected concerns over slowing revenue growth and unmet high expectations. The stock remains up over 190% for the year.

Other tech stocks faced pressure, with Amazon dropping 2.2% and Alphabet falling nearly 5% amid ongoing antitrust worries as DOJ recently proposed Google sells Chrome to address the issue. However, Snowflake soared 33% after surpassing estimates and raising its product revenue guidance, while Salesforce gained 3.1%. Whereas, The Russell 2000 Index, viewed as a barometer for small companies and beneficiary of a possible boost to the economy from President-elect Donald Trump, added more than 1%.

Baidy falls yet beats: Chinese tech giant Baidu posted a 3% annual drop in third-quarter revenue, nevertheless beating market expectations amid AI cloud growth. The revenue print came in at $4.78 billion for the quarter ending on Sept. 30. Net income for the period rose by 14% to $1.09 billion. Baidu noted a 12% surge in its non-online marketing revenue to the equivalent of $1.1 billion, mainly driven by its artificial intelligence cloud business.

đŸ’” Personal Finance

Improve your credit score – part II

Let’s continue yesterday’s topic and have a look at a few more ways to improve your credit score:

  • Review your credit reports

    Have a look at your credit score and identify factors that are causing your score to go low. Furthermore, it allows you to monitor your progress as you work to improve your credit score. You can see how your actions are affecting your score over time.

    Also, by reviewing your credit report, you can set realistic goals for improving your credit score. You can track your progress and adjust your strategies as needed to achieve your goals.

  • Keep credit utilization under 30%
    Credit utilization is a significant factor in determining your credit score. It refers to the ratio of your outstanding credit card balances to your credit card limits.

    Using a large percentage of your available credit can indicate to lenders that you may be overextended financially. This can lower your credit score, especially if your credit card balances are close to or exceed your credit limits.

    Ideally, you should aim to keep your credit utilization below 30%. Keeping it low shows lenders that you are managing your credit responsibly and can positively impact your credit score.

  • Consider debt consolidation

    Consolidating multiple debts into a single loan or credit card can make it easier to manage payments. This can reduce the risk of missing payments, which can negatively impact your credit score. Also, if you use a debt consolidation loan to pay off credit card balances, your credit utilization ratio may improve.

    Furthermore, it can improve your payment history and allow you to enjoy lower interest rates by consolidating more expensive loans.

It can take three to six months for you to see results. The key lies in being persistent and continuing to manage your finances and you will have an improved credit score in no time.

Check this video for more:

💰 Be a Better Investor

I love, love, love that you want to use your debit card. But to keep your credit score solid, you still need to keep a few credit cards and use them at least once every few months.

Suze Orman

Resources:

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Nothing in this newsletter is financial advice. Always do your own research and think for yourself.