Today is Monday, June 22 and Wall Street is starting the week flat after reaching its fourth weekly gain in the past 5 weeks. Existing home sales plunged in May, but Realtors think that was the bottom. We also see that U.S. banks are flush with cash as deposits increase by $2 trillion amid the pandemic. In addition, Airbnb says the company is ready for another downturn due to significant cost cuts and Apple approved a software update to a paid email app after its makers complained that the rules for Apple’s App Store were unfair.
Stocks traded lower to start the week as investors assessed an uptick in coronavirus cases and the pace of the economic recovery. The major U.S. stock averages are coming off their fourth weekly gain in five weeks. Both the Dow and S&P 500 advanced at least 1% last week, while the Nasdaq Composite surged more than 3%.
Existing home sales plummeted in May as the coronavirus continued to hammer the economy, but Realtors expect that it will represent the bottom. Sales of existing homes in May fell 9.7% compared with April and were down 26.6% annually. That is the largest annual decline since 1982, when interest rates were about 18%. It is also the slowest sales pace since October 2010.
A record $2 trillion surge in cash hit the deposit accounts of U.S. banks since the coronavirus first struck the U.S. in January, according to FDIC data. The wall of money flowing into banks has no precedent in history: in April alone, deposits grew by $865 billion, more than the previous record for an entire year. The gains were all driven, in one way or another, by the response to the pandemic.
Airbnb CEO Brian Chesky said the company made significant cost cuts to prepare it for another downturn if Covid-19 cases spike again. Chesky also said the company is waiting for the market to settle before it moves forward with its plans to go public, which were put on pause this year due to the pandemic.
Apple approved a software update to a paid email app after its makers complained that the rules for Apple’s App Store were unfair, spurring a round of developer anger ahead of Apple’s annual software conference that kicks off Monday. Basecamp, the makers of Hey email, previously said that Apple threatened to remove their new service from the App Store, which is the only way for most people to install software on an iPhone.