🏠 New home sales rebound

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Good morning investors! Merry Christmas, people. This is our last issue of the week. The market will have shorter hours tomorrow, be off for X-Mas, then have shorter hours on Friday. We’ll see you Monday, next week.

Today we cover:

• New US home sales rebound

• Stocks jump again

• BTC keeps falling

📊 Economy and News 

New U.S. Home Sales Rebound, but Rising Mortgage Rates Loom

Sales of new single-family homes in the U.S. climbed 5.9% in November to a seasonally adjusted annual rate of 664,000 units, recovering from hurricane-related declines the previous month. The Commerce Department revised October’s sales higher to 627,000 units, up from the initially reported 610,000 units.

New home sales, which represent roughly 15% of the market, were 8.7% higher compared to the previous year. Economists had anticipated a rebound to 660,000 units, reflecting the volatile nature of month-to-month figures.

Despite this growth, rising mortgage rates could dampen future sales. The average 30-year fixed mortgage rate edged up to 6.72%, following a dip to 6.60% earlier.

Global hits:

• Mega Millions jackpot soars to an estimated $944 million for Christmas Eve drawing.

• Revised figures from the U.K.’s Office for National Statistics showed GDP did not grow at all in the three months to September.

• Britain’s economy flatlined in the third quarter, revised figures show.

Free money: Some taxpayers can expect to get up to $1,400 payments from the IRS by late January. A total of 1 million taxpayers will receive an estimated $2.4 billion in payments. The money will go to individuals who still haven’t been paid the Covid-19 relief funds — more popularly known as stimulus checks — they were due.

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📈 Stocks

S&P 500 5,974.07 (+0.73%)
DJIA 42,906.95 (+0.16%)
NASDAQ 19,764.88 (+0.98%)
BRENT CRUDE 72.63 (-0.43%)
* Prices as of Dec 24th, 12:20 AM UTC

Labor Strikes and Supply Chain Disruptions Expected in 2025

The S&P 500 closed higher Monday, as tech made a strong start to a holiday-shortened week, driven by a rally in semiconductor stocks. But, there are a few worries ahead.

As the holiday season unfolds, labor strikes at Amazon warehouses, driven by the Teamsters union, are adding strain to an already fragile supply chain. These actions precede a potential January strike by dockworkers at 36 U.S. East and Gulf Coast ports, threatening further disruptions in 2025.

Mike Short, president of global forwarding at C.H. Robinson, noted the ongoing rise in strike activity, urging industries like automotive and pharmaceuticals to prepare contingency plans. The looming January 15 deadline for negotiations on port automation between U.S. ports and the International Longshoremen’s Association raises the stakes, with global shipping companies like Maersk advising clients to move cargo proactively.

Interesting: Nordstrom to go private in $6.25 billion deal with founding family, Mexican retailer. Elsewhere, U.S. sues Walmart, Branch Messenger over payment accounts for delivery drivers.

🔐 Crypto

Bitcoin $94,733 (+0.04%)
Ether $3,422 (+4.33%)
Solana $174.53 (+0.3%)
Total market cap $3.24T (+0.09%)
* Prices as of Dec 24th, 12:20 AM UTC

Bitcoin keeps falling

The cryptocurrency market has shed $500 billion in value, dropping from last week’s $3.9 trillion peak to $3.4 trillion. Bitcoin, which accounts for 56% of the market, now has a capitalization of $1.9 trillion as it has fallen 14% from high last week.

The selloff mirrors declines in other risk-sensitive assets, with the S&P 500 down 2% over the past week. This downturn followed the Federal Reserve’s meeting, where heightened concerns about inflation and fewer expected interest rate cuts in 2025 weighed on investor sentiment. Higher interest rates often push investors toward safer assets, reducing demand for cryptocurrencies.

Despite the drop, Bitcoin remains up 120% year-to-date and 36% since Donald Trump’s election victory, which reignited optimism in the crypto space. However, sharp corrections are not unusual for Bitcoin, which has weathered significant declines in the past, including a 70% drop from 2021 to 2022.

Similar trends are evident in other high-growth assets like Tesla stock, which is down 12% from its recent peak but still up 70% since the election. For now, crypto investors are bracing for continued volatility.

We’re not surprised because we talked about the future of BTC in our Future Download issue here. Here’s an excerpt from the issue:

Interested in AI, crypto, and the future? Join Future Download today.

💵 Personal Finance

Uncertain Times Ahead for the Global Economy in 2025

In 2024, central banks succeeded in curbing inflation without triggering a recession, allowing for long-awaited rate cuts. Stock markets soared, with the U.S. and Europe reaching record highs, and wealth surged as 141 new billionaires joined Forbes’ list. However, this economic optimism failed to resonate with voters grappling with a relentless cost-of-living crisis, leading to widespread electoral upsets across major democracies.

The coming year looks even more daunting. Potential U.S. import tariffs could spark a trade war, fueling inflation and economic slowdown. In fact, CNBC says that Trump’s 25% tariff could be an existential threat to Canada’s recovering auto industry.

Conflicts in Ukraine and the Middle East, political gridlock in Europe, and China's slowing growth add to the uncertainty. Meanwhile, the escalating cost of climate-related damage looms as a growing financial burden.

The poorest countries, already in their worst economic state in two decades, are most vulnerable to these headwinds. Wealthier nations, facing disillusioned voters, must address declining living standards while managing stretched budgets post-pandemic. Failure to act risks political instability and economic fragility.

Global policymakers, including European Central Bank President Christine Lagarde, warn of “abundant uncertainty” ahead. With the IMF urging resilience, 2025 will test whether the global economy can navigate these compounding challenges and achieve sustainable stability.

In these times, we’d suggest that you move cautiously and safeguard your interest by diversifying your investments and keeping an eye on global happenings. We’ll continue to bring you the latest news and happenings here so you can stay aware.

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

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