Good news for airlines and credit cards, bad news for builders today.
1) Home builders gloomy. The National Association of Home Builders (NAHB) monthly report on builder sentiment was much weaker than expected. While some drop was expected after the tax credit expired, the NAHB chairman said, "the reduction in consumer activity may have been more dramatic than some builders had anticipated."
2) Airlines new highs. Specifically, new highs for:
US Airways ,
—as United updated its guidance yesterday after the bell. Simply put, more butts are in fewer seats. Airlines are cutting capacity and raising prices--that means revenue per available seat mile (RASM, a key industry metric) is improving.
3) Delinquency trends continue to improve. Credit card delinquencies (30 days or more late) dropped at both Capital One and Discover again in May—at Capital One, delinquencies were down for the fourth straight month to 4.80 percent (from 5.07 percent in April). Lower delinquencies means that charge-offs will likely decline and that will be a help to earnings. Waiting for data shortly from Bank of America , Citigroup and JPMorgan .
Loan levels are trending below expectations, but that is little surprise given that consumers are continuing to try to save money any way they can.
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