Rocket Stock Is the New Meme Trade. Move Over, GameStop.
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    HOUSE MEDIAN ASKING PRICES AND WEEKLY CHANGE     Sydney $1,614,335 (+0.67%)       Melbourne $994,236 (-0.05%)       Brisbane $963,341 (+1.45%)       Adelaide $854,556 (-1.91%)       Perth $827,309 (-0.33%)       Hobart $759,718 (-0.29%)       Darwin $667,381 (+0.62%)       Canberra $1,007,406 (-0.44%)       National $1,037,260 (+0.22%)                UNIT MEDIAN ASKING PRICES AND WEEKLY CHANGE     Sydney $750,961 (+0.91%)       Melbourne $497,942 (-0.57%)       Brisbane $535,693 (+0.31%)       Adelaide $419,051 (-1.28%)       Perth $437,584 (-0.67)       Hobart $516,868 (-0.64%)       Darwin $347,954 (-4.64%)       Canberra $497,324 (-0.10%)       National $524,930 (-0.09%)                HOUSES FOR SALE AND WEEKLY CHANGE     Sydney 10,416 (-208)       Melbourne 14,951 (-211)       Brisbane 8,223 (+52)       Adelaide 2,527 (+10)       Perth 6,514 (+149)       Hobart 1,343 (+29)       Darwin 248 (-7)       Canberra 1,065 (+22)       National 45,287 (-164)                UNITS FOR SALE AND WEEKLY CHANGE     Sydney 8,842 (+1)       Melbourne 8,108 (+15)       Brisbane 1,720 (+26)       Adelaide 459 (+19)       Perth 1,750 (+6)       Hobart 209 (+4)       Darwin 403 (+1)       Canberra 928 (+7)       National 22,419 (+79)                HOUSE MEDIAN ASKING RENTS AND WEEKLY CHANGE     Sydney $790 (+$10)       Melbourne $600 ($0)       Brisbane $630 ($0)       Adelaide $620 (+$20)       Perth $660 ($0)       Hobart $550 ($0)       Darwin $700 ($0)       Canberra $690 (-$10)       National $662 (+$2)                UNIT MEDIAN ASKING RENTS AND WEEKLY CHANGE     Sydney $750 ($0)       Melbourne $590 ($0)       Brisbane $625 ($0)       Adelaide $480 (+$5)       Perth $590 (-$5)       Hobart $470 ($0)       Darwin $550 (+$15)       Canberra $565 (-$5)       National $589 (+$1)                HOUSES FOR RENT AND WEEKLY CHANGE     Sydney 5,061 (-35)       Melbourne 5,308 (+108)       Brisbane 3,854 (+1)       Adelaide 1,161 (-25)       Perth 1,835 (+6)       Hobart 376 (-10)       Darwin 138 (+1)       Canberra 525 (-5)       National 18,258 (+41)                UNITS FOR RENT AND WEEKLY CHANGE     Sydney 6,806 (-66)       Melbourne 4,431 (+62)       Brisbane 1,997 (-30)       Adelaide 323 (-15)       Perth 609 (+30)       Hobart 153 (+3)       Darwin 210 (-15)       Canberra 537 (+30)       National 15,066 (-1)                HOUSE ANNUAL GROSS YIELDS AND TREND       Sydney 2.54% (↑)      Melbourne 3.14% (↑)        Brisbane 3.40% (↓)     Adelaide 3.77% (↑)      Perth 4.15% (↑)      Hobart 3.76% (↑)        Darwin 5.45% (↓)       Canberra 3.56% (↓)     National 3.32% (↑)             UNIT ANNUAL GROSS YIELDS AND TREND         Sydney 5.19% (↓)     Melbourne 6.16% (↑)        Brisbane 6.07% (↓)     Adelaide 5.96% (↑)        Perth 7.01% (↓)     Hobart 4.73% (↑)      Darwin 8.22% (↑)        Canberra 5.91% (↓)     National 5.84% (↑)             HOUSE RENTAL VACANCY RATES AND TREND       Sydney 0.8% (↑)        Melbourne 0.7% (↓)     Brisbane 0.7% (↑)      Adelaide 0.4% (↑)        Perth 0.4% (↓)     Hobart 0.9% (↑)        Darwin 0.8% (↓)     Canberra 1.0% (↑)      National 0.7% (↑)             UNIT RENTAL VACANCY RATES AND TREND       Sydney 0.9% (↑)        Melbourne 1.1% (↓)     Brisbane 1.0% (↑)      Adelaide 0.5% (↑)      Perth 0.5% (↑)        Hobart 1.4% (↓)     Darwin 1.7% (↑)      Canberra 1.4% (↑)      National 1.1% (↑)             AVERAGE DAYS TO SELL HOUSES AND TREND       Sydney 25.8 (↑)      Melbourne 26.6 (↑)        Brisbane 26.8 (↓)     Adelaide 22.5 (↑)      Perth 31.4 (↑)      Hobart 24.3 (↑)        Darwin 26.7 (↓)     Canberra 25.5 (↑)        National 26.2 (↓)            AVERAGE DAYS TO SELL UNITS AND TREND       Sydney 24.5 (↑)      Melbourne 25.5 (↑)      Brisbane 26.1 (↑)      Adelaide 23.6 (↑)      Perth 31.2 (↑)      Hobart 24.6 (↑)      Darwin 38.8 (↑)      Canberra 28.0 (↑)      National 27.8 (↑)            
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Rocket Stock Is the New Meme Trade. Move Over, GameStop.

Rocket, the parent of Quicken Loans, has surged 28% this week.

By Orla McCaffrey
Thu, Mar 4, 2021 12:40amGrey Clock 4 min

The individual investors that powered GameStop Corp.’s meteoric rise have a new target: Rocket Cos., the parent company of Quicken Loans.

Shares of the mortgage lender surged 28% since the end of last week. Nearly 377 million shares traded hands on Tuesday alone, more than a 10-fold increase from the previous day. After surging 71% on Tuesday, the stock lost some steam on Wednesday, falling 33%, or $13.59, to $28.01.

Like GameStop, Rocket is heavily shorted. As of this week, 46% of its shares available for trading were being shorted by investors betting the price would fall, according to S3 Partners, a data-analytics firm. That was up from about 33% in late January and 17% in mid-September, according to FactSet.

Trading of Rocket shares was halted several times this week because of its volatility.

Individual investors on WallStreetBets, the Reddit community that gave birth to GameStop’s rise, have been encouraging each other to buy the stock in recent days and sharing evidence of their own massive gains. They have relished in the company’s name——Rocket——an apt one for their goal of higher prices.

“The $RKT is fueled and ready for liftoff,” one user wrote early this week.

The company stock symbol, RKT, was mentioned in nearly 16,000 Reddit comments on Tuesday, according to data from TopStonks.com, a website that tracks equities mentioned on Reddit. That is up from just over 6,000 on Monday and less than 1,000 on most days last week.

Rocket announced last week it would pay a one-time dividend of $1.11 per share later this month, citing its “highly profitable and capital light business model.” Some investors saw the move as a way to fend off short sellers. Short sellers are obliged to pay any dividends to the broker they borrowed shares from.

The company’s excess capital at the end of the fourth quarter made the dividend possible, Rocket CEO Jay Farner said at a conference Wednesday morning.

“We were pretty proud to be able to offer that to our shareholders,” Mr Farner said. “We think more of dividends as special dividends because we want that flexibility to make the right investment for the long-term growth of the organisation.”

Rocket has other upsides. Rising mortgage rates are boosting earning potential for mortgage lenders just as the crucial spring home-selling season kicks off. The average rate on the 30-year fixed-rate mortgage rose to 2.97% recently, its highest level since August.

Detroit-based Rocket is the largest mortgage lender in the U.S., according to research firm Inside Mortgage Finance. Its $323 billion in home loans in 2020 easily surpassed the $221 billion originated by its closest competitor, Wells Fargo & Co. Its large size and strong brand—it ran two Super Bowl commercials—set it apart from other non-bank lenders.

Before Rocket’s blastoff, shares of nonbank mortgage lenders had done little to impress investors in recent months. Some of the lenders that listed their shares on the public market in recent months significantly downsized their offerings. Some never made it to market because of tepid investor interest.

Shares of Rocket hadn’t strayed too far from their listing price of $18 in the seven months since the company’s IPO. The stock soared to more than $31 in its first month but quickly returned to near $20.

The first sign of liftoff came late last week, when Rocket reported impressive fourth-quarter results. Shares rose almost 10% on Friday. The news of a sizable dividend prompted Rocket’s initial jump in stock price, said KBW analyst Bose George.

“The initial move made some sense, but since then, fundamentals haven’t been driving it,” Mr George said. “It’s other factors that we have a harder time assessing.”

Shortly before its public-market debut last summer, Rocket announced an ambitious expansion target: cornering 25% of the mortgage market over the next decade. Its market share currently stands at about a third of that, according to Inside Mortgage Finance.

Rocket said last week that its mortgage originations more than doubled in 2020. It said it expects continued high origination levels despite weakening margins.

The amount lenders earn when they sell each loan has started to drop. Quicken’s gain-on-sale margin was 4.41% in the fourth quarter, down from the third quarter but well above the 3.41% it recorded a year earlier. It expects its first-quarter margin to be between 3.6% and 3.9%.

Cleveland Cavaliers owner Dan Gilbert helped found Quicken Loans in the 1980s and still holds the majority of its shares.

Ali Habhab has watched the stock’s recent ride with interest but doesn’t plan to sell his shares any time soon. Mr. Habhab, who is 25 years old, instead hopes his returns will bring him closer to his goal of retiring at 40. He bought 1,000 shares in Rocket shortly after the company’s IPO in August.

Mr. Habhab, who works in automotive manufacturing, said he was familiar with Quicken Loans long before parent company Rocket decided to go public. Mr. Habhab lives in Detroit, where Rocket is based, and has friends who started careers at the company or one of its subsidiaries.

“With all that factored in, it was a no-brainer to put some of my money where it belongs and where it will grow,” Mr Habhab said.

Another major nonbank mortgage lender, UWM Holdings Corp. is up 27% so far this week.



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The End of Japan’s Negative Rates Will Be a Slow-Moving Tsunami

Long-term effects of positive Japanese rates could be profound—on everything from mortgage rates to U.S. government finances

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Japan’s stocks have reached levels that haven’t been seen for 34 years . The country is likely to hit another milestone soon: Its central bank could raise interest rates for the first time in 17 years as soon as Tuesday.

Higher, and positive, Japanese rates won’t reshape markets overnight. But the long-term effects could be profound, particularly if U.S. growth heads structurally lower for any reason, further narrowing the yield advantage of many U.S. assets. Japan is the single largest overseas holder of U.S. Treasurys, a major overseas lender, and an export heavyweight whose corporate earnings—and stocks—have been significantly supported by the ultra cheap Japanese yen. More Japanese capital staying at home could eventually impact the price of everything from U.S. mortgages to infrastructure finance in the developing world.

For much of the past two years, Japan has swum against global monetary tides, maintaining its ultra low interest-rate regime. But now, as most other major central banks are about to cut rates, the Bank of Japan is poised to break the trend again. Domestic media reported over the weekend that Japan’s central bank will end its negative interest rates, which have been in place since 2016, during its policy board meeting on Monday and Tuesday.

The decision would come after mounting evidence that the job market is on an increasingly strong footing , after years of stagnant wage growth. Unions secured an average salary increase of 5.28% , according to the first-round results of Japan’s annual spring wage negotiations, the Japanese Trade Union Confederation said last week. For the entire decade ending in 2022, the final annual increase never exceeded 2.4%.

Much likely won’t change in the short term. The Bank of Japan will probably pace its rate increases slowly: The past couple of years have, if anything, reaffirmed its reputation for moving slowly and deliberately. Moreover, while inflation is still high by Japanese standards—2.2% in January—it has already cooled from the peaks of last year.

Japanese bond yields have picked up, but they are still substantially lower than in the U.S. The rate differential between 10-year government bonds in the U.S. and Japan stands at 3.5 percentage points. That is significantly lower than the 4.2-percentage-point gap of a few months ago, but still way higher than the 1.5 percentage points of three years ago.

Even so, a narrowing rate gap—especially if the Fed cuts rates later this year, as seems likely—will support the Japanese yen . That could damp enthusiasm for rip-roaring Japanese stocks . They would become more expensive in dollar terms for foreign investors, who have been significant drivers of the rally. A stronger yen would also hit profits at some Japanese companies , especially big exporters.

Likewise, gradual interest-rate increases in Japan probably won’t change investment flows much in the short term. But it could be a different story down the road if the shift back to positive rates proves sustainable.

Japanese individuals and companies have been big investors abroad in search of higher yield for decades. The country’s foreign-portfolio investments stood at the equivalent of $4.2 trillion at the end of last year. A big chunk of that comes from Japanese pension funds and insurers, who would suddenly have more attractive options at home. Japanese investors, for example, hold around $1.1 trillion of Treasury bonds, making them the largest foreign owner.

Japanese investors have been scouring the globe for better returns for as long as most investors can remember. If that starts to change, the effects will be felt nearly everywhere—sooner or later.

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This stylish family home combines a classic palette and finishes with a flexible floorplan

35 North Street Windsor

Just 55 minutes from Sydney, make this your creative getaway located in the majestic Hawkesbury region.

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