The Housing Market Slumped This Spring. Where Does It Go From Here?

0:00This podcast is sponsored by Comcast Business. When business leaders struggle to get measurable value out of artificial intelligence, it's often because they're operating AI on top of disjointed architectures, says Amit Verma, Chief Technology Officer at Comcast Business. That's why we make sure AI works with a connectivity fabric that permanently links people, applications, data, and machines everywhere and all the time. That's continuous intelligence. Later, he'll explain why it can bring cohesion to AI deployments.

0:33Jennifer Hiller:The AI rally that boosted tech stocks has turned into a sell-off. Is it time to be worried yet? These stocks have had such an incredible run that even while these sort of daily declines seem big and are evaporating a lot of value for investors, it's really kind of a blip. Plus, a late winter drop in mortgage rates wasn't enough to save the spring home buying season. We get into what it would take for the housing market to bounce back. And move over detergent pods, the company behind Tide, now wants you to wash your clothes with tiles? It's Tuesday, June 23rd. I'm Alex Osalev for The Wall Street Journal.

1:09Jennifer Hiller:This is the PM edition of What's News, the top headlines and business stories that move the world today.

1:18Jennifer Hiller:The tech sell-off that has been rippling around the world deepened today. The Nasdaq dropped 2.2 percent. Intel, NVIDIA, Oracle, and Tesla all fell 4 % or more following steep losses in big tech stocks yesterday. The S &P and Dow had smaller losses, falling about 1.4 % and 0.1%. For more on what's driving stocks lower, I'm joined by WSJ Markets reporter David Huberti. David, why are tech stocks hurting in particular? One of the big catalysts that investors are citing is the expectation for higher interest rates from the U.S. Federal Reserve. the new Fed chairman, Kevin Warsh, last week in his first appearance as chair was unexpectedly hawkish in his commentary, basically suggesting that the U.S.

2:01Fed might actually keep rates steady if not raise them in response to above-target inflation. And due to the fact that many of these tech names that we follow every day are increasingly issuing debt in order to build out data centers, fund all their computing operations, the higher interest rates could really impact their operations in a really big way and ultimately impact how profitable those companies are in the years ahead.

2:25Jennifer Hiller:Some of the companies hit hardest today, Micron and SpaceX. Why those in particular? SpaceX has been continuing its pullback since its post-IPO pop. At one point today, shares were actually trading below where they were initially issued during the IPO. Stocks like that are inherently volatile, and SpaceX just has a tremendous valuation vis-a-vis what its actual business fundamentals are. Micron and Sandisk were the two largest losers in the S &P 500 today. Despite its declines today, Sandisk is still up 4 ,000 % over the last 12 months. Micron, which is worth more than a trillion dollars, is still up 700 % over the last 12 months or so.

3:05So that just sort of goes to show that these stocks have had such an incredible run that even while these sort of daily declines seem big and are evaporating a lot of value for investors, it's really kind of a blip. And the big question is whether that will continue, whether these AI jitters are sort of emblematic of something to come, or whether this is just one of those momentary pullbacks, whether firms on Wall Street are shifting the dials in their investment strategies somewhat.

3:32Jennifer Hiller:That was WSJ Markets reporter David Huberti. Thanks, David. Thanks. Meanwhile, oil prices are falling. Brent crude futures slipped more than 1 % to$77.08 a barrel, the lowest settlement price since the day before the start of the war with Iran. In corporate news, the journal has learned that Walmart is buying a French advertising technology firm for$1.4 billion. Buying Vibe.co, which enables advertising through connected TVs, is Walmart's biggest deal in two years, and it's the company's latest investment in its efforts to compete with Amazon for new advertising revenue streams.

4:11Jennifer Hiller:The crucial spring home buying season is over, and it was a disappointment. Home sales have been holding at depressed levels, dashing hopes of a market rebound. Journal reporter Nicole Friedman, who joined us in the second episode of our housing series this morning, says that doesn't bode well for what's left of 2026. The spring market is really crucial for the rest of the year. A lot of people want to move in the spring or move over the summer, And so if they miss that opportunity, they might delay it a whole year. And so some of the demand that didn't show up this spring won't necessarily come later in the year.

4:45Jennifer Hiller:We might have to wait until 2027. If conditions get better in the fall or even the winter, we see a decline in mortgage rates or a decline in home prices, an increase in inventory. There are definitely a lot of buyers that would jump on that, but it wouldn't be as big of a wave as we would have seen this spring if the conditions had been better. Factors like the Iran war and a hawkish Federal Reserve have sent mortgage rates even higher, yesterday reaching 6.66 percent. But Nicole says that as some of that volatility settles down, where rates land could still make a difference for the housing market.

5:20Jennifer Hiller:The components of affordability are incomes, home prices, and mortgage rates. And so mortgage rates coming down would make a huge difference. Also, home prices, which are still on a national basis ticking higher, you know, that could make the difference for some buyers. We are seeing income growth. And so slowly, people's incomes are kind of over the years going to catch up with the change in housing affordability. But that's a very slow process. That's not something that is necessarily going to happen this year. And we'll be talking more about this topic on tomorrow afternoon's episode of What's News as we continue our housing series with a look at the federal efforts to solve the housing crisis.

6:04Jennifer Hiller:Coming up, the Trump administration is betting big on nuclear energy. That's after the break.

6:14Continuous intelligence is the ability to keep insights moving, turning signals into decisions and decisions into actions without losing context, momentum, or trust. That's the CTO at Comcast Business, Amit Verma. He believes continuous intelligence and operating posture linking people, applications, data, and machines is critical for AI success. It's important to have an integrated system that can power AI workflows with a flexible connectivity fabric and machine speed threat intelligence.

6:49Jennifer Hiller:In Washington, the Senate voted to limit President Trump's ability to conduct military operations against Iran without congressional authorization. The resolution passed this afternoon in a 50-48 vote and directs the president to remove U.S. armed forces from hostilities unless explicitly authorized by Congress, other than to defend America, an ally, or partner from, quote, imminent attack. Four Republicans joined with Democrats in the non-binding vote. Top-ranking Senate Democrats are calling for hearings into a secret$500 million investment into the Trump family's cryptocurrency venture from a group led by a senior Emirati Royal.

7:24Jennifer Hiller:The deal was first reported by The Wall Street Journal earlier this year. In a letter addressed to the Republican committee chairs, the Democratic senators argued hearings on the deal would compel White House officials to explain what they knew about the payments and when. The lawmakers wrote that the investment raises, quote, questions about what more the UAE may receive or may have already received at the expense of U.S. national security. A White House spokeswoman said that President Trump's businesses are held in a trust managed by his children. And the Supreme Court has ruled that a Rastafarian prisoner can't sue guards who violated his beliefs by forcibly shaving his head, narrowing a federal law meant to protect religious rights in state prisons.

8:04Jennifer Hiller:The ruling was one of five decisions the high court issued today as it races to wrap up its work before taking a summer recess, which typically happens in late June or early July. There are 12 cases still pending, all of them involving major issues such as birthright citizenship, presidential power, transgender athletes, and election law. The court's next scheduled day to issue decisions is Thursday.

8:29Jennifer Hiller:The Trump administration is eager to see a nuclear power renaissance. So eager, in fact, that it's putting up billions of dollars to make it happen. Today, the Energy Department announced that it's offering low-interest loans amounting to more than$17 billion to help utilities finance orders for nuclear reactors from the company Westinghouse. Jennifer Hiller, who covers the power industry for the journal, joins me now with more. Jennifer, from what I understand, the idea is that utilities are the ones who are taking out these loans. What is the goal of the program overall? When would it hope to get some nuclear reactors online?

9:02Jennifer Hiller:What it would do would be to go towards equipment orders. So things like heavy vessels and steam generators and things that take maybe three or four years to build. they would go ahead and start making those long lead items that you would need for a reactor. And the idea is that you shave a few years off and that you would start delivering big reactors around 2035. Why is the Trump administration starting this program now? At this point, we have rising power demand, especially from things like AI. So we need more baseload power coming onto the grid. And nuclear is very reliable. And it is a technology that really needs a lot of government involvement because it's expensive and difficult and can take a while to build.

9:51Right.

9:52Jennifer Hiller:I mean, in the past, projects to build reactors have really struggled to get off the ground. Costs have spiraled out of control. I'm thinking specifically of two of these reactors in Georgia that were supposed to cost$14 billion, but they ended up costing$30, so more than double. So is$17.5 billion that the Trump administration is allocating for this enough to really make a difference? It's enough to get equipment orders made. So it's not for construction. You know, essentially, this gets the supply chain moving because there would be orders of identical equipment. All of the factories would have kind of this reliable series of orders.

10:31Jennifer Hiller:Westinghouse and its suppliers can guarantee sort of a price. And that would be one way to help control costs. So it isn't a complete solution. solution. But it's saying we are going to start working on the parts and pieces that go into the reactor that take a long time to build. And we're going to go ahead and do that while we figure the rest of this stuff out. That was Journal reporter Jennifer Hiller. Thanks, Jennifer. Thank you.

10:59Jennifer Hiller:Finally, your detergent is being disrupted. Procter & Gamble, which controls about 60 % of the U.S. laundry detergent market, is rolling out its latest concoction, a tile called Tide Evo. It took more than a decade to develop and costs almost twice as much as a tub of its previous laundry innovation, Tide Pods. Journal reporter Natasha Kahn recently visited the company's R &D facility in Ohio, and she said there's a good reason why they started working on this new detergent shortly after Tide Pods were introduced in 2012. One of the things that Victor Aguilar, who is in charge of P &G's$2 billion annual R &D budget, and I were speaking about is that consumer products really evolve on an S-curve.

11:40Jennifer Hiller:So there's a cycle of introduction, growth, maturity, and decline. So according to him, many products peak at about 14 years. So for them, it's really important to keep coming up with innovations for the market, even when existing products are selling well. So actually, the development of these TIE tiles, which took about 10 years to make, they really started that process very soon after pods were first launched to the market. Natasha says the company designed the EVO tiles with some different factors in mind. P &G, they invest a lot in observing consumers and understanding consumers. And there were a few things that they identified as maybe the trends that we'll be seeing now.

12:18Jennifer Hiller:It's interesting because they were predicting this in the early 2010s. And it's things like aftleisure wear and synthetic fibers being a lot more popular. It's things like, you know, maybe with energy costs being on the rise, Americans would prefer to have a solution where they can wash their clothes in cold water. So these are things that they would observe and they come up with this. So what's your laundry hot take? Do you get down with pods? Cold water only? Is fabric softener a scam? We want to know. If you're a listener on Spotify, leave us a comment with your thoughts. And that's what's news for this Tuesday afternoon.

12:55Jennifer Hiller:Today's show is produced by Danny Lewis and Anthony Bansi with supervising producer Katie Ferguson. I'm Alex Osula for The Wall Street Journal. We'll be back with a new show tomorrow morning. Thanks for listening.

13:17To develop continuous intelligence, enterprises must address technical debt from legacy systems, cross-functional misalignment, data security, and data quality. As Comcast Business CTO Amit Verma notes, it's not easy. AI agents generate a lot of data and they need low latency for inference. So the biggest challenge is having a robust infrastructure where you can pass data between agents and your large language models at a low latency speed so you're not slowing things down. As leaders create an environment for data to move seamlessly, they must also manage risk. Governance must be built into orchestration, workflows, and AI systems from the start.

13:59Guardrails, auditability, and the clear ownership of data and tools need to be developed. Visit ComcastBusiness.com slash Enterprise to learn how Comcast Business helps enterprises navigate an ever-changing technology landscape. This content was created by Custom Content from WSJ, a unit of the Wall Street Journal Advertising Department.