The Housing Market Slumped This Spring. Where Does It Go From Here?
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What caused the recent sell-off in tech stocks?
The AI rally that boosted tech stocks has turned into a sell-off. Is it time to be worried yet?
These stocks have had such an incredible run that even while these sort of daily declines seem big and are evaporating a lot of value for investors, it's really kind of a blip.
Plus, a late winter drop in mortgage rates wasn't enough to save the spring home buying season. We get into what it would take for the housing market to bounce back. And MoveOver detergent pods, the company behind Tide, now wants you to wash your clothes with tiles? It's Tuesday, June 23rd. I'm Alex Oselev for The Wall Street Journal. This is the PM edition of What's News, the top headlines and business stories that move the world today. The tech sell-off that has been rippling around the world deepened today. The Nasdaq dropped 2.2 percent. Intel, Nvidia, Oracle, and Tesla all fell 4 percent or more, following steep losses in big tech stocks yesterday. The S&P and Dow had smaller losses, falling about 1.4 percent and 0.1 percent.
For more on what's driving stocks lower, I'm joined by WSJ Markets reporter David Uberti. David, why are tech stocks hurting in particular?
One of the big catalysts that investors are citing is the expectation for higher interest rates from the U.S. Federal Reserve. The new Fed chairman, Kevin Walsh, last week in his first appearance as chair was unexpectedly hawkish in his commentary, basically suggesting that the U.S. Fed might actually keep rates steady if not raise them in response to above-target inflation.
Why did the spring home buying season disappoint?
And due to the fact that many of these tech names that we follow every day are increasingly issuing debt in order to build out data centers, fund all their computing operations, the higher interest rates could really impact their operations in a really big way and ultimately impact how profitable those companies are in the years ahead.
Some of the companies hit hardest today, Micron and SpaceX. Why those in particular?
SpaceX has been continuing its pullback since its post-IPO pop. At one point today, shares were actually trading below where they were initially issued during the IPO. Stocks like that are inherently volatile, and SpaceX just has a tremendous valuation vis-a-vis what its actual business fundamentals are.
What factors could lead to a rebound in the housing market?
Micron and SanDisk were the two largest losers in the S&P 500 today. Despite its declines today, SanDisk is still up 4,000% over the last 12 months. Micron, which is worth more than a trillion dollars, is still up 700% over the last 12 months or so. So that just sort of goes to show that these stocks have had such an incredible run that even while these sort of daily declines seem big and are evaporating a lot of value for investors, it's really kind of a blip. And the big question is whether that will continue, whether these AI jitters are sort of emblematic of something to come, or whether this is just one of those momentary pullbacks, whether firms on Wall Street are shifting the dials in their investment strategies somewhat.
That was WSJ Markets reporter David Uberti. Thanks, David.
Thanks.
Meanwhile, oil prices are falling. Brent crude futures slipped more than 1% to $77.08 a barrel, the lowest settlement price since the day before the start of the war with Iran. In corporate news, the Journal has learned that Walmart is buying a French advertising technology firm for $1.4 billion. Buying Vibe.co, which enables advertising through connected TVs, is Walmart's biggest deal in two years. And it's the company's latest investment in its efforts to compete with Amazon for new advertising revenue streams. The crucial spring home-buying season is over, and it was a disappointment. Home sales have been holding at depressed levels, dashing hopes of a market rebound. Journal reporter Nicole Friedman, who joined us in the second episode of our housing series this morning, says that doesn't bode well for what's left of 2026.
The spring market is really crucial for the rest of the year. A lot of people want to move in the spring or move over the summer.
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