Bloomberg Daybreak: US Edition Daybreak Weekend: Tesla Earnings, ECB Decision, Japan Election
Jul 18, 2025
Isabel Reynolds, the Tokyo Bureau Chief for Bloomberg News, joins the discussion on crucial financial developments. They delve into the implications of Tesla's upcoming earnings and the sluggish U.S. housing market, touching on challenges like competition and safety concerns with autonomous vehicles. The conversation shifts to Japan, previewing the upper house election amid rising public discontent and inflation. Insights into the Bank of Japan's interest rate policies and their economic impacts add depth to the analysis, offering a comprehensive look at regional and global financial dynamics.
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Housing Market Faces Diverging Trends
- The existing home sales market has bottomed out with modest growth expected, but home prices still show local variations with some declines.
- New home sales face challenges due to persistent high prices, rising inventories, and decreasing returns on buyer incentives.
Mortgage Rates Impact Housing Demand
- Mortgage rates near 7% and their volatility remain a major barrier for homebuyers, impacting affordability and applications.
- Only a sustained drop to low 6% or high 5% range could restore buyer confidence.
Tesla Eyes Future Beyond Earnings
- Tesla's Q2 earnings are expected to meet consensus but investor focus is on Elon Musk's plans and new models.
- The robo-taxi service is promising but will not be a significant revenue contributor before 2027 due to safety and developmental challenges.