Markets rebounded from yesterdays selloff. It seems that traders are happy one day and not the next. The underlying economic fundamentals continue to be positive. The latest GDP growth estimate was 2% coming in below estimates calling for economic growth of 2.2%. The main reason for the miss was lackluster consumer activity in the first quarter. At the close the Dow posted a 98 point gain on lighter trading volume to close at 24,216,
Prices of lumber continue to pull back from all-time highs. For the past two weeks the Random Lengths Framing lumber index has declined and now stands at $554 down from a recent high of $581 at the beginning of June. It is still up from a year ago price level of $397. As prices fell over the past two weeks buyers responded by stepping up and making purchases to replenish inventories. In a recent survey, over 30% of single family home builders reported shortages of framing lumber. This is the highest reading for that metric since 1994. Builders also reported shortages of trusses, lightweight steel, OSB and plywood.
You have to love Amazon. They announced today that they were buying privately held online pharmacy Pillpack for an undisclosed figure. Some are estimating the purchase price at about a billion dollars. In reaction to this move, traditional pharmacy chains CVS, Ride-aide and Walgreens collectively lost $12 billion in market value. The Amazon assault on traditional business models continues. Just so Amazon does not start its own Boy Scout troop or make a move into Girl Scout cookies we should be good!