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Market Snapshot: Week of June 4

June 04, 2018
Juan Artiles
Newsroom Contributor

We believe that knowledge is power and we want you to have more of it. The best realtors can engage their customers in conversation on a wide-range of topics, from business trends and shifting political landscapes to the latest happenings in the world of sports, art, and pop-culture. We've summarized the biggest happenings from these sectors so that you don't have to.

Miami’s existing condo market posted its best April in three years, and more families than ever are moving to downtown Miami. Meanwhile, the G-7 trade rift deepened, two new European leaders were sworn in, and “Solo: A Star Wars Story” stalled at the box office – here are the stories you should have on your radar this week.

Business

Market Snapshot (June 4,2018)

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  • Dow Jones: 24,635 (-0.48%)
  • S&P 500: 2,735 (+0.51%)
  • Nasdaq: 7,554 (+1.61%)
  • Bitcoin: $7,754 (+7.67%)
  • 10-Year US Treasury: 2.909%

Market Winners:

  • American Eagle Outfitters quarterly sales rose another 9% from last year to over $800 million. And while the rest of retail's stocks are down this year, AE's is up 20%. American Eagle’s underwear and intimates brand, Aerie, enjoyed record sales growth, surging 38% last quarter.
  • Walmart, America’s biggest retailer, has taken a big step to compete with Amazon by introducing its concierge shopping service. Walmart’s new service, Jetblack, is launching at $50/ a month and already lets New Yorkers text for same-day delivery.
  • Lululemon, a yoga-inspired athletic apparel company, saw shares jump 7% to a record high after quarterly sales popped 20% to $650 million. More impressively, its direct-to-consumer sales from its website jumped 62%. Cutting out the retail middleman/woman has been a good business strategy for Lulu.

Market Losers:

  • General Motors shares rose 14% on news Japan’s colossal tech investor Softbank gave it $2.25 billion for self-driving car technology. This makes GM look like a dominant leader in the self-driving car experience for years to come, along with Waymo and Uber.
  • Shares of Americana classics such as Harley-Davidson and Jack Daniels owned by Brown-Forman dropped on word that the EU, Mexico, and Canada are targeting their goods in retaliation to President Trump’s new steel and aluminum tariffs.

Other Market News:

  • Overnight, the MSCI Asia Pacific Index added 1.4 percent while Japan’s Topix index closed 1.5 percent higher. In Europe, the Stoxx 600 Index was 0.5 percent higher at 6:22 a.m. S&P 500 futures pointed to a gain at the open, the 10-year Treasury yield was at 2.92 percent, and gold was a little higher, according to Bloomberg.

Real Estate

Local:

  • Miami’s existing condominium market posted its best April in three years as condo transactions jumped 24.6 percent and condo dollar volume surged 40.8 percent year-over-year, according to a new report by the MIAMI Association of REALTORS® (MIAMI) and the Multiple Listing Service (MLS) system. Miami single-family home sales and residential prices rose. Amongst the highlights of the report, include:
    • Total sales volume for all properties jumped 17.8 percent, from $1.01 billion to $1.19 billion.
    • Condominium sales in the $150K to $300K range led the charge in the robust April for Miami existing condominiums.
    • Miami-Dade County single-family home prices increased 7.8 percent in April 2018, increasing from $320,000 to $345,000. Existing condo prices rose 5.4 percent, from $229,000 to $241,325 in April.
    • Only 6.1 percent of all closed residential sales in Miami were distressed last month, including REO (bank-owned properties) and short sales, compared to 10.0 percent in April 2018.
    • The median number of days between listing and contract dates for Miami single-family home sales was 45 days, an 8.2 percent decrease from 49 days last year.
    • The median time to contract for condos was 79 days, a 3.9 percent increase from 76 days last year.
    • To read the full report, click here.
  • More people than ever live in downtown Miami – and they are starting to raise families, reports the Miami Herald. A new analysis of Greater Downtown Miami demographics by the Miami Downtown Development Authority, which uses data from the U.S. Census, shows the population in Greater Downtown Miami has hit an all-time high of 92,235 — a 65 percent jump from 2000-2010 and another 38 percent increase from 2010-2018. 
  • The Grammy-award winning singer Shakira has put her Miami Beach estate on the market for $11.6 million. The waterfront home, located at 3140 North Bay Road, features six bedrooms and 7.5 baths
  • Investment guru and Research Affiliates founder Rob Arnott just closed on a waterfront spec mansion in Miami Beach for $32M USD, in what looks to be the most expensive purchase in Miami-Dade since at least 2015, says The Real Deal South Florida.
  • Florida is attracting Wall Street power players from New York and Connecticut, after the recent federal tax overhaul capped the amount of state and local deductions by individuals. According to The Real Deal South Florida, the Sunshine State gained 14,700 jobs in the financial activities category, which includes bank workers, over the 12 months ending in April compared to Connecticut’s loss of 500 over that period. In the months since Federal Tax Reform was introduced, New York has jumped to #1 on the Top 10 U.S. Cities searching for Miami real estate, a spokesperson from the Miami Association of REALTORS told the Cervera Newsroom.
  • Brightline extended scheduled service to Miami on May 19th following the unveiling of its MiamiCentral transportation hub. Next stop: Orlando. The higher-speed passenger railroad, which began limited service Jan. 8 between Fort Lauderdale and West Palm Beach, represents a $6 billion USD in direct economic impact to Florida’s economy over the next eight years and will remove three million vehicles from the road annually.

Politics & Foreign Affairs

North America:

  • The proposed summit with North Korea in Singapore will go ahead on June 12 according to President Trump on Friday. The President spoke outside the White House after a meeting with Korean officials as the two sides try to revive a potentially historic summit. The President said, "They want it, we think it's important, and I think we would be making a big mistake if we didn't have it.”
  • Friday's monthly employment report was great news for anyone looking for a job in America, unless you happen to be a Democrat running for Congress, according to CNBC. The economy added roughly 223,000 net new jobs in May, pushing the jobless rate a tick lower to 3.8 percent, an 18-year low. Business is coming alive in the U.S.
  • Last Thursday the Trump administration announced that it would begin imposing tariffs on steel and aluminum from our allies, Europe, Mexico, and Canada, in a move that was met with immediate vows of retaliation. Prime Minister of Canada Justin Trudeau announced retaliatory "dollar for dollar" sanctions against the U.S for the newly imposed tariffs. Stock prices also fell amid fears of a trade war, with the Dow Jones industrial average plunging nearly 252 points, or 1 percent, to 24,415.84.

Central America:

  • As per Yahoo News, at least six people were killed and another 20 injured on Sunday when Guatemala's Fuego volcano erupted violently, spewing a stream of red-hot lava and belching a thick plume of black smoke and ash that rained onto the capital and other regions. The sudden eruption has forced the Guatemala City's La Aurora International Airport to close its only runway due to the presence of volcanic ash jeopardizing passenger and aircraft safety.

Europe:

  • A political coup in Spain saw Socialist leader Pedro Sanchez assume office Saturday. Sanchez needs to appease anti-establishment Podemos and nationalist parties from Catalonia and the Basque region who helped him oust Mariano Rajoy, says Bloomberg.
  • In Italy, Giuseppe Conte, 53, a law professor with no political experience, was sworn in as prime minister on Friday in a compromise brokered by the two populist parties in power. Now the hard work begins, according to Bloomberg: Italy’s anti-establishment Five Star Movement and the anti-immigrant League form an uneasy coalition catering to different constituencies with different priorities that will make delivering on electoral promises no small task. An Italian newspaper editorial speculated that tensions might boil over to the point that new elections are called later this year or early next year.
  • Also in Italy, UniCredit SpA is reportedly contemplating a merger with France’s Societe Generale SA, which would potentially combine two of Europe’s largest financial institutions.

Sports

North America:

NBA Finals:

  • The lasting impression from Game 1 of the 2018 NBA Finals was superstar LeBron James' disbelief over JR Smith's late-game mistake that cost the game; we’ve provided the costly play above for your pleasure. Game 2 took place last night with the Golden State Warriors defeating LeBron and the Cavaliers 122 – 103. LeBron James cannot catch a break as he faces one of his hardest NBA Finals of his career. For a recap of the NBA Finals so far, click here.

Entertainment

  • The second weekend of "Solo: A Star Wars Story," which depicts the life of Han Solo a rebellious youthful pilot in the Star Wars universe, made an estimated $29.3 million in North America, according to the studio. That's a drop of roughly 65% from its first weekend's three-day total of $84.4 million. Things are only getting harder for Solo in the Box Office as summer blockbusters such as Ocean's 8, Pixar's Incredibles 2 and Jurassic World: Fallen Kingdom are releasing right around the corner.
  • Harvey Weinstein was led in handcuffs past photographers on Friday as he appeared in court to face charges of rape and sexual misconduct. Mr. Weinstein’s appearance in Manhattan Criminal Court lasted barely 10 minutes, and shortly after his defense lawyers handed in Mr. Weinstein’s passport and paid his bail with a $1 million cashier’s check. As part of his bail package, Mr. Weinstein has agreed to wear a monitoring device and restrict his travel to New York and Connecticut.

Quote of the Week

All the opinions expressed by Juan Artiles in this newsletter are solely his opinions. You should not treat any opinion expressed by his as a specific inducement to make a particular investment or follow a particular strategy, but only as an expression of his opinions.

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