May 21, 2024

On Tuesday, the S&P 500 was up 0.25% while Toronto was unchanged.

Tesla (not on our list but I own a little) was up 6.7%.

Toll Brothers reported a 60% earnings gain after the close but is only up 1% in after-hours trading.

Housing starts in Canada were down 9% year over year in May driven by a huge 37% drop in Ontario. The figure for single family detached homes was up 3% for Canada with Ontario down 8%.

Alberta housing starts were up a HUGE 62% with single-family detached up 37%. This should bode well for Melcor Developments although I have been hitting a brick wall in trying to get them to understand that their land development costs must be too high and that a 40% gross margin on lot sales is just too low considering that the dollars in inventory could be tied up for perhaps 8 years. They have refused to do the analysis that I suggest is needed.

I updated the reports for the Brookfield Office Properties rate reset shares. See Subscriber Home Page. You may recall these shares REALLY tanked in the Fall and it was hard not to fear they might go to zero. In late December their credit rating was lowered to Junk status. But the shares then turned higher and have made very strong gains since then.

Sometimes it feels like the market tries to shake us loose from positions. And it sometimes offers up juicy bargains but it seems very scary to buy.

It’s easy now to think that these share s were obvious bargain at their lows. But they also looked like obvious bargains on the way down well before they bottomed and it was a painful ride down. I held on through the Fall and have not sold and that has worked out well.

Canada’s inflation for May came in at 2.7% and this lowish level is giving hope for an interest rate cut in June. All else equal that would be positive for stocks and bonds.

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