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đ Home stretch
Good morning. The generation raised on TikTok is now the one keeping bookstores in business. New research from Cambridge University Press found that two-thirds of Gen Z (opens in a new tab) called themselves readers in 2025, up 14 points from 2022. Physical book reading climbed too, with 59% more Gen Zers picking up a print book during the same period. That means the group famous for six-second attention spans can still crack open a paperback novel. Bookmarks over brainrot.
Top Idea
The Housing Slump Has Pushed Homebuilder Stocks Into Bargain Territory
Housing stocks may finally have something solid beneath them. Mortgage costs are squeezing buyers out, builders are losing momentum, and investors have spent months backing away from the sector. That pain has pushed valuations low enough to turn the weakness into an opportunity.
Unlocking value: Evercore analysts say a rare valuation trigger has returned for small-cap builders, giving battered housing stocks a possible contrarian setup. The median small-cap homebuilder now trades below book-value levels that have often preceded sector gains, even when the market backdrop felt awful. Stephen Kim, Aatish Shah, and Randa Shaw noted, âThe median small-cap homebuilder is now trading below 0.80x book value (opens in a new tab).â
- Evercore's homebuilding index has historically returned a median 16% after three months, 36% after six months, and 59% after one year.
- The iShares US Home Construction ETF recently fell to its lowest level since May as mortgage rates crossed 7% again.
Demand Is Cracking Where Builders Feel It First
Builders arenât getting relief from buyers yet. A BTIG/HomeSphere survey of 59 small- and mid-sized builders found August demand weakened across sales, traffic, pricing, and incentives. The same survey found only 19% of builders (opens in a new tab) reported higher year-over-year sales in August, the weakest reading since Nov. 2023.
- Only 14% of builders said August sales beat expectations, while 44% said sales came in worse than expected.
- Base-price cuts doubled from July levels, with 30% of builders reducing some or all listed prices during August.
Rates still run the show: Bond yields still hold the keys to housing. Mortgage rates tend to follow the 10-year Treasury more closely than short-term Fed policy, which means a Fed move alone may not bring buyers much relief. Freddie Macâs average 30-year mortgage rate has climbed to 6.7% (opens in a new tab), keeping affordability stretched and buyers on the sidelines. That pressure continues to weigh on Lennar, D.R. Horton, and PulteGroup. The buy signal may be flashing, but rates still decide when the door actually opens.
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What stocks benefit if oil stays above $100?
Diesel has climbed above $6 a gallon for the first time ever. It was $3.70 a year ago, and the old record, set at the peak of the 2022 inflation spike, was $5.81. Brent crude back above $100 is driving it.
- The obvious trade already ran: Energy is 2026's best-performing sector, with the Energy Select Sector SPDR up ~47% against 13% for the S&P 500. Buying producers now means paying for a war premium that unwinds the moment the Strait of Hormuz reopens â and in peacetime, roughly a fifth of the world's oil moves through it.
- The money is moving down the chain: Refiners earn on the spread between crude and diesel rather than on the crude price itself, tankers earn on the longer routes the conflict forces, and services firms earn on drilling budgets. Oil and gas deal spending hit a two-year record in the first half of 2026, according to Wood Mackenzie.
Here's what we're asking Finks to prepare:
Large-Cap Recap
Atlanta Braves Holdings Offers Rare Sports Franchise Value
Atlanta Braves Holdings trades at a discount to recent deals for teams like the Angels and Padres. That lower valuation comes as wealthy buyers compete for scarce sports franchises. The company also owns The Battery Atlanta, generating mixed-use revenue that cushions baseball operations against potential labor strife ahead of the December CBA expiration. Short interest has climbed as a result, though patient long-term investors are eyeing the underlying private market asset value. [Read (opens in a new tab)]
The Consumer Trade Gets Selective
Household budgets are tightening just as consumer companies face less room for error. TJX Companies, Carnival, American Airlines, and Booking Holdings are navigating that squeeze, while Nike and Lululemon need more than brand power to win shoppers. Airlines also have rising fuel costs eating into the resilience of travel demand. The better bets are companies that can hold onto customers without sacrificing margins. [Read (opens in a new tab)]
Packaged Food Giants Test Shoppers With Fresh Price Hikes
Packaged food makers are raising prices again as inflation drives up energy, freight, and ingredient costs across the industry. Campbell's and Conagra Brands are pushing through higher prices on meals and snacks to protect profit margins after squeezing costs as far as possible. Meanwhile, shoppers are growing increasingly selective and turning to cheaper store alternatives. That dynamic leaves food companies balancing margin protection against the risk of losing volume. [Read (opens in a new tab)]
Market Pulse
Dell Technologies Inc.
DELLThe computer makerâs shares hit a record high as investors piled into hardware companies positioned to benefit from growing AI data center spending.
Oklo Inc.
OKLOThe nuclear technology companyâs shares fell after launching a new at-the-market stock offering program that could raise up to $1B.
ON Semiconductor Corporation
ONThe chipmakerâs shares jumped as easing inflation worries fueled a broader semiconductor rally, with upbeat industry news and technical momentum adding support.
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Markets & Economy
BofA warns US stocks face more volatility: Bank of America says $14.2B has left US equity funds over three weeks as investors grow more cautious. Rising Treasury yields, expensive commodities and uncertainty around AI spending are creating a shakier backdrop for stocks. [Read (opens in a new tab)]
Colgate explores $1B-plus personal care sale: Colgate-Palmolive is considering divesting brands including Softsoap, Irish Spring, and Speed Stick as it sharpens its portfolio. The move would free resources for core businesses while North American sales remain under pressure. [Read (opens in a new tab)]
Record US cyclospora outbreak ends: The CDC says the largest US cyclosporiasis outbreak on record is over after nearly 13K people were sickened across 21 states. The outbreak was linked to shredded iceberg lettuce supplied by Taylor Farms in Mexico. [Read (opens in a new tab)]
Business & Tech
Uber reinvests layoff savings into cheaper rides: Uber plans to use savings from recent corporate cuts to lower prices, expand ride options and fund growth. CEO Dara Khosrowshahi says the goal is to drive more marketplace activity while executives continue buying shares. [Read (opens in a new tab)]
PayPal CEO opts for turnaround over buyout: CEO Enrique Lores rejected a $53B buyout offer to prove the payments giant is worth more independent. The company is leaning into Venmo expansion and cost cuts to fund its next chapter. [Read (opens in a new tab)]
Kroger trims sales outlook on pharmacy and produce hits: Kroger lowered its annual same-store sales forecast after Medicare drug-pricing changes and a cyclospora outbreak weighed on revenue. The grocer still reaffirmed its adjusted earnings outlook of $5.10 to $5.30 a share. [Read (opens in a new tab)]
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Digit of the Day
Hot August Inflation Locks in 90% Odds of a Fed Hike
The guessing game around next weekâs Fed meeting is over. Augustâs inflation report sent the odds of a rate hike surging to 90% (opens in a new tab), up sharply after core prices climbed 0.3% for the month and 2.4% annually â both hotter than economists expected. For anyone banking on cheaper borrowing soon, rate cuts are looking like next yearâs problem.
- Gasoline alone added 3.9% and was the biggest driver of Augustâs CPI gain â while shelter rose 0.3% for consumers (opens in a new tab).
- Against the 3.4% headline CPI, average hourly earnings only rose 3.1% â marking a fifth straight month of real wage declines (opens in a new tab).
Memory squeeze: Computer software and accessories now cost 25.4% more than a year ago, the sharpest annual jump on record. Apple cited an âextraordinary surgeâ in memory and storage demand from AI data centers when it raised prices in June, then hiked iPhone prices again this week. Microsoftâs Xbox, Nintendo, and Amazon followed suit. Consumer sentiment already cracked in September on rising price worries, and with AI infrastructure spending still accelerating, the tech aisle isnât done handing bills to shoppers.
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