Vaccine Hope | Lockdowns Loom | Mall Merger
U.S. equity markets climbed to fresh record-highs on Monday following the release of positive trial results from Moderna's COVID-19 vaccine candidate, offsetting near-term concerns over economic shutdowns in several states.
Following combined gains of 10% over the past two weeks, the S&P 500 finished higher by 1.2% today while the Dow Jones Industrial Average rallied 471-points, closing just shy of 30,000.
Adding to a historic rebound last week, the COVID-sensitive property sectors led the Equity REIT Index to gains of 1.0% today as 14 of 18 property sectors finished in positive territory.
The ongoing merger saga between Simon Property (SPG) and Taubman Centers (TCO) appears to be nearing a relatively peaceful conclusion after the two firms agreed to a revised agreement following months of legal sparring.
The jam-packed week of economic data begins tomorrow with Retail Sales and Homebuilder Sentiment. Later this week, we'll see Housing Starts, Building Permits, and Existing Home Sales. REITworld also begins tomorrow, one of two major REIT industry conferences.
Real Estate Daily Recap
U.S. equity markets climbed to fresh record-highs on Monday following the release of positive trial results from Moderna's (MRNA) COVID-19 vaccine candidate, offsetting near-term concerns over economic shutdowns in several cities and states. Following combined gains of 10% over the past two weeks, the S&P 500 ETF (SPY) finished higher by 1.2% today while the Dow Jones Industrial Average (DIA) rallied 471 points closing within 50 points of 30,000. Adding to a historic rebound last week, the COVID-sensitive property sectors led the broad-based Equity REIT ETF (VNQ) to gains of 1.0% today as 14 of 18 property sectors finished in positive territory while the Mortgage REIT ETF (REM) jumped 3.4%, adding to last week's gains of nearly 9%.
Déjà vu? After Pfizer's (PFE) announcement of positive vaccine trial results sent markets surging last Monday, Moderna announced this morning that its vaccine was 94.5% effective at protecting people from Covid-19 and expects to submit for an Emergency Use Authorization (EUA) "in the coming weeks." As discussed in our Real Estate Weekly Outlook, the clock is ticking for approval and distribution amid a "third wave" of targeted economic shutdowns in several hotspots around the country. 10 of the 11 GICS equity sectors finished higher today, led by the Energy (XLE) and Industrials (XLI) sectors. Residential REITs lifted the Hoya Capital Housing Index to solid gains as well ahead of a jam-packed week of housing data beginning on Tuesday as well as earnings reports from Home Depot (HD) and Lowe's (LOW).
The busy week of economic data begins tomorrow morning with Retail Sales data for October, which are coming off a stronger-than-expected gain in September. Also on Tuesday, the NAHB will release Homebuilder Sentiment data for November, which climbed to the highest level on record in the last report. On Wednesday, we'll see Housing Starts and Building Permits for October which are each expected to continue their strong post-pandemic rebound. Finally, on Friday, we'll see Existing Home Sales for October. Existing Home Sales rose to the strongest sales pace in 14 years in September. As usual, we'll be watching the weekly Jobless Claims data on Thursday as well as Mortgage Applications data on Wednesday.
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