After the financial markets plummeted Friday in reaction to hawkish Fed commentary, discussions centered around whether the major averages have taken a fresh leg down.
Cryptocurrencies, which trade 24/7, were seen extending their weakness into the weekend. Against this backdrop, here's a recap of a few major headlines that hit the wire over the weekend.
1. Housing Prices In Overvalued Markets To Cool Off: The housing market has experienced a correction, with home sales, both existing and new ones, falling and home prices seeing accelerated growth amid rising mortgage rates.
Moody’s Analytics is now predicting U.S. home prices will remain flat to fall by 5%, Fortune reported, citing the rating agency's chief economist Mark Zandi. If a recession occurs, home prices in 183 of the nation’s 413 largest housing markets will likely drop by 15%-20%, he added. These 183 overvalued markets include Boise, Charlotte and Austin.
2. Musk Keeps Chirping On Twitter: Tesla, Inc. (NASDAQ:TSLA) CEO Elon Musk was very brisk on Twitter over the weekend. Particularly important was the billionaire’s take on battery chemistries. When id Software founder John Carmack discussed the futility of having battery chemistry that provides a long life for electronics products, Musk jumped in and suggested how battery cycles and energy density can be improved.
In separate tweets, he offered an update on his SpaceX venture’s Falcon 9 rocket, made the case for increasing nuclear power generation and reiterated his preference for Diet Coke.
3. Bitcoin Fails To Hold Support At $20K: Bitcoin (CRYPTO: BTC), which fell over 1% drop on Friday, broke below the psychological barrier of $20,000 on Saturday, dropping below the level for the first time after mid-July. The crypto closed at sub-$20,000 levels both on Saturday and Sunday. Market-wide risk aversion amid economic uncertainty was blamed for the move lower.
4. Apple’s Intriguing Invite: Apple, Inc.'s (NASDAQ:AAPL) invite for the “Far Out” event — both the tagline and the graphics that accompanied it — set tongues wagging about Cupertino having an ace up its sleeve. Bloomberg’s Mark Gurman said the company could be signaling anything from a simple cosmos-themed wallpaper to its always-on mode to even a satellite phone.
5. Dollar’s Unnerving Strength: Fed Chairman Jerome Powell sent the U.S. dollar firmly higher with his commitment to keep the central bank’s policy rate elevated to ward off inflation threat. In early Asian trading on Monday, the U.S. dollar index rose to a 20-year high of 109.4.
Economists see further dollar strength as the Fed has clearly signaled that it is not yet done with rate hikes.
What Else? Pointing to historical trends and the heavy short bets against key indices, market participants and analysts have begun warning of a lean patch for the market in September.
Following Tesla’s 3-for-1 split, sell-side analysts scrambled to adjust their stock price targets for the EV maker. Tesla bear Gordon Johnson of GLJ Securities stands out with his $22 price target for the stock. The analyst justified his price target by stating that the period of hypergrowth may be a thing of the past for the company.
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