Stock Market Update

[BRIEFING.COM] The S&P 500 (-0.4%), Nasdaq Composite (-0.4%), and DJIA (-0.1%) continue to steadily move towards their flatlines after a sharp opening dip. 

KB Home (KBH 63.66, +1.28, +2.05%) reported a solid Q3 but tempered its full-year outlook as affordability and a cool housing market pressured volumes and margins. The homebuilder beat EPS expectations while pulling FY25 housing revenue guidance down to $6.10-$6.20 billion and signaled a near-term margin trough before a planned pivot back toward higher-margin built-to-order (BTO) homes.

Other homebuilder names are under pressure today, with the iShares U.S. Home Construction ETF down 1.0% as rate cut expectations for the October and December FOMC meetings come under question.

Kansas City Fed President Jeffrey Schmid (voting FOMC member) stated in a speech today that "my view is that inflation remains too high while the labor market, though cooling, still remains largely in balance." 

While softness in the labor market was a driving force behind this month's 25-basis point cut to the Fed funds rate, jobless claims have decreased in recent weeks, which could stifle further rate cuts this year if inflation remains above target.