Home builders sold some more new houses in the U.S. last month than they did in June. But the bigger news might be that builders have more houses to sell.

The Commerce Department on Tuesday reported that 708,000 new single-family homes were sold in July at a seasonally adjusted, annual rate—a bit more than the 700,000 that economists had forecast. Better still, June new-home sales were revised to 700,000 from the previously reported 676,000. That offers a hint that this year’s decline in new-home sales is starting to reverse itself.

One reason why might be that builders have begun putting more homes on the block. There were a seasonally adjusted 367,000 new homes on the market at the end of July, enough supply for 6.2 months of sales at last month’s rate, compared with 348,000 in June. That is important because last year’s rush for new homes severely depleted inventories. There were only 3.5 months-worth of supply last October, matching a record low previously...

Best Buy has gone from Amazon ’s showroom to a rising competitor to the e-commerce giant.

The consumer electronics retailer handily beat Wall Street expectations on both the top and bottom lines in the quarter ended July 31, with net income 56% higher than analysts were penciling in. Even compared with the pre-pandemic year, its revenue grew 24%. Best Buy’s shares jumped 6.4% Tuesday morning after its earnings call.

A return to bricks-and-mortar shopping is clearly helping. Revenue through Best Buy’s stores last quarter was higher compared with the pre-pandemic period even though it was working with fewer stores, the company noted on its Tuesday call. At the same time, the share of online sales doubled over the same period.

Chip shortages don’t seem to be crimping sales much, either. The company said that except for home theater and appliances, both of which are among the company’s the highest growing sales categories, product availability didn’t...

This column is part of the Heard on the Street stock-picking contest. You’re invited to play along with us here.

Many mortgage stocks seem like money pits right now, but investors who sift through the listings might find one with good bones.

New Residential Investment Corp. is a type of real-estate investment trust that invests in mortgage-related assets rather than properties. It also owns a mortgage lending and servicing firm, Newrez, and has just completed the acquisition of another, Caliber. New Residential is among the largest nonbank owners of mortgage servicing rights, or MSRs, which confer the right to a stream of fees earned for doing things like collecting a mortgage’s monthly payments and distributing them to investors.

One thing ailing mortgage-originator stocks—many of them are down more than 10% over the last six months—is concern that the pandemic-spurred wave of refinancing in the U.S. is winding down. Even as benchmark 30-year mortgage...

Yale University named internal endowment veteran Matthew Mendelsohn as the next head of its more than $31 billion endowment, capping a search for the successor to famed endowment manager David Swensen.

The 36-year-old Mr. Mendelsohn was a protégé of Mr. Swensen’s who joined the Yale Investments Office in 2007 and went on to run its venture capital investments. Yale’s venture footprint makes up more than a quarter of its endowment’s portfolio and has been an important contributor to the endowment’s returns in recent years.

Former Yale provost and search committee chair Ben Polak said in a statement Tuesday, “The committee left no stone unturned in the search. In the end, the right answer was immediately before us. Matt Mendelsohn has the respect of his colleagues, of managers, and of his peer CIOs—and an extraordinary record of investing, building and leading teams, and representing what is best about Yale.”

Several in the endowment investing world said...

The Wall Street Journal launched a five-week newsletter course this year with our best lessons for understanding how to invest in the stock market, from how to pick a stock to why diversification matters.

The course, written by the columnists of WSJ’s Heard on the Street, is now making its way into classes around the world to teach young people five important principles of investing as interest in retail investing and meme stocks continues to grow.

For gig economy investors, Proposition 22 might have been too good to be true.

The ballot initiative, passed by California voters last year, enabled companies such as Uber Technologies , Lyft , DoorDash and Instacart to continue to classify their drivers as independent contractors rather than employees. The timing of the vote last November played to gig companies’ strengths. Amid the pandemic, Californians relied on services like food and grocery delivery, as well as ride-hailing alternatives to public transportation—all of which use gig economy drivers. Ahead of the vote, some gig companies publicly suggested they could pull out of operations in California, at least temporarily, if Proposition 22 didn’t pass.

The future could look different, though. On Friday, a California judge said Proposition 22 was unenforceable and unconstitutional because it limited the legislature’s ability to allow workers to collectively bargain for things like workers’ compensation....

Everyone wants state and local-government bonds. That’s a good thing if you already own muni debt, and a bad thing if you’re trying to get your hands on some.

The yield on the S&P Municipal Bond Index this summer fell below 1% for the first time since it was created in 1998. The index tracks returns on a selection of core municipal bonds from across the market and assumes any interest thrown off is reinvested. The yield in question—known as yield to worst—is the lowest rate the investor can expect to earn short of a default.

Still, investors can’t get enough of the bonds. Prices have surged even though outstanding muni debt has swelled by more than $100 billion in the year ended March 31, according to Federal Reserve data. Cities and states could probably sell an additional $89 billion in bonds without meaningfully driving down prices, according to an analysis of lending capacity by Municipal Market Analytics. Bond yields rise as prices fall.

“If...

This column is part of the Heard on the Street Stock Picking Contest. You’re invited to play along with us here.

Digital payment providers have been among the pandemic’s biggest winners. For Adyen , an Amsterdam-listed company that supplies white-labeled services to the likes of Uber, eBay and Spotify, prospects look undiminished even as the world reopens.

The closure of the retail and travel industries hit traffic through Adyen’s platform when Covid-19 first spread across the world. But the company serves a range of sectors and soon regained its stride as more spending moved online. Its share price has roughly quadrupled over the past two years, making it one of Europe’s largest technology companies with a market value of around €82 billion, which is equivalent to $96.31 billion.

Reopening is expected to reset some businesses that thrived on social distancing, but likely not Adyen. For a start, its hotel and airline customers will bounce back. More...

The euro is trading near its lowest level against the dollar in nine months as investors bet that the eurozone will maintain lower interest rates and have a slower economic recovery than the U.S.

The European Central Bank has indicated that it intends to keep financial conditions loose for the foreseeable future as it cushions the eurozone’s economic recovery. In contrast, Federal Reserve officials have signaled they are on track to begin reversing their easy-money policies later this year.

The policy split means investors may get paid more to hold U.S.-dollar assets like Treasurys than they would eurozone assets, where government bonds in Germany and some other countries already have subzero yields.

“The idea is that as we slowly get into a bit more of a mature phase of the recovery in developed markets, that central banks are going to start tightening policy but the ECB is going to sit right back at the end of the queue,” said Simon Harvey, senior...

This column is part of the Heard on the Street Stock Picking Contest. You’re invited to play along with us here.

Avocado-toast-munching millennials might not be able to afford a house, but they can dip into a stock selling the fruit.

Listed on the Nasdaq in October, California-based Mission Produce offers a rare pure play on avocados, which the company sources from growers—mostly in Mexico, California and Peru—packs and distributes. Mission also has its own farming operations in Peru, Guatemala and Colombia, which produced around 11% of the avocados it sold in 2019.

Driven by health trends and the popularity of Mexican cuisine, U.S. per capita consumption of avocados—abundant in monounsaturated fat, which fights bad cholesterol—rose to 8.5 pounds in 2019 from 3.2 pounds in 2015, according to the USDA. Consumption fell in 2020, likely because the pandemic hurt demand from restaurants.

Coming off record highs in 2019, avocado prices started to...

Drought is blistering key U.S. cash crops, further elevating prices for staples including corn and wheat.

The punishing dynamics of a torrid summer were evident this month on the Pro Farmer Crop Tour, an annual event in which farmers visit key growing areas across the grain belt to gather data on the coming harvest. Driving along state Route 14 outside of Verdigre, Neb., Randy Wiese turned to see a farmer harvesting hay. The piles were small.

“That farmer is sick to his stomach,” said Mr. Wiese, who farms 800 acres of soybeans and corn in Lake Park, Iowa.

He isn’t alone. Farm incomes have been hit hard over the past two years, first when Covid-19 shutdowns hammered prices and afterward when hot, dry weather reduced output, limiting farmers’ capacity to cash in on rising demand and higher prices.

Extreme heat is baking most of the U.S. North Dakota, South Dakota, Minnesota, Iowa and Nebraska all contain areas of extreme drought, according to data...

U.S. stock futures edged up Tuesday, suggesting that gains in technology stocks will help send the S&P 500 to an all-time high. Here’s what we’re watching ahead of the opening bell.

U.S. stocks rose Tuesday, putting the S&P 500 on pace for another record close as the approval of Pfizer Inc.’s Covid-19 vaccine continued to lift sentiment.

The S&P 500 ticked 0.2% higher. A day earlier, the broad market index closed at its second-highest level ever. Dow Jones Industrial Average gained 0.2% on Tuesday, while technology-heavy Nasdaq-100 rose 0.4%.

Stocks have been grinding higher as investors weigh strong corporate earnings and the economic rebound against the global surge in Covid-19 cases, which is prompting fresh restrictions in some markets. Money managers are also assessing whether the Federal Reserve may slow down plans to pare back its easy-money policies because of signs that economic growth may be slowing.

“Markets are struggling for direction a little bit after we have had a huge run,” said Mike Stritch, chief investment officer at BMO Wealth Management. “People are asking, what is the next catalyst to propel the...

SYDNEY—One of this year’s hottest commodities is flaming out.

The price of iron ore has fallen roughly 40% since mid-July on concerns about demand from China, which makes more than half of the world’s steel. The downturn has dealt a blow to producing countries, notably Australia and Brazil, that are battling to protect fragile economic recoveries from outbreaks of the highly contagious Delta variant of the coronavirus.

The benchmark price fell as low as $130.20 a metric ton on Thursday following a 15% single-day nosedive to its lowest value since November 2020, according to S&P Global Platts, which publishes daily prices. The commodity, which hit a record above $233 a ton as recently as May, bounced slightly to $139.10 a ton on Friday.

Other commodities including oil and copper have been falling on worries that rising Covid-19 cases might hobble the global recovery, but not at such a rapid pace. Iron ore hasn’t fallen this far this fast since spot...

TOKYO—Half or more of Japan’s huge government debt doesn’t really exist. And even if it does, the country needs a lot more of it.

Those are a couple of the arguments being heard in Tokyo as the rich world’s most-indebted government relative to its size prepares for a new round of spending this fall that could reach into the hundreds of billions of dollars.

Japan often serves as a tryout venue for policies that later debut on the world economy’s biggest stage, the U.S. The Japanese central bank was a pioneer in introducing zero interest rates and buying large quantities of government bonds to stimulate a sluggish economy, tools subsequently used by the Federal Reserve.

In debt as well, Japan has led the pack. Its central-government debt first surpassed the size of the economy about 20 years ago. Now the U.S. is crossing that threshold too, and Congress is debating trillions of dollars more in proposed spending.

Tokyo’s central government is...

The U.S. economic expansion is losing momentum.

Softening demand at a time of rising Covid-19 cases, labor shortages and persistent knots in shipping networks are restraining businesses in the U.S. and across the globe, according to private-sector surveys released Monday.

The biggest shifts are occurring in the U.S., which has helped drive the global economic expansion since last year’s severe recession. U.S. factories and service providers reported sharply slower growth in August, the forecasting firm IHS Markit said Monday in its surveys of purchasing managers. Its index of service-sector activity, the broadest segment of the economy, fell to 55.2 in August from 59.9 in July, hitting an eight-month low. An index of factory activity dropped to 61.2, a four-month low, from 63.4 in July. A reading above 50 suggests activity—as measured by sales, output, prices and other factors—is growing.

But the surveys show that the Delta variant of the Covid-19...

U.S. stocks edged up Monday, boosted by technology stocks and full approval for Pfizer Inc.’s Covid-19 vaccine.

The S&P 500 ticked nearly 1% higher, pointing to the broad market index extending Friday’s 0.8% gain, led by energy, industrials and tech. The Nasdaq climbed 1.5%, indicating a larger rise in technology stocks. Meanwhile, the Dow Jones Industrial Average rose 0.8%.

The Covid-19 vaccine from Pfizer and partner BioNTech received full approval from U.S. regulators, which many public health officials and vaccine experts hope will encourage hesitant populations to get the shot. Pfizer rose 2.8% and BioNTech climbed more than 10%.

“Many believe that [vaccine approval] will create that much more momentum in vaccine trends, especially in those states and population groups that are lagging,” said Joe Amato, chief investment officer at Neuberger Berman.

Investors also are focused on the Federal Reserve’s annual economic policy symposium...

Two major U.S. money-transfer services have suspended payments into Afghanistan, and American banks are more closely scrutinizing transactions with Afghan counterparts, as they await clarity on whether U.S. sanctions on the Taliban apply across the nation now that the Islamist group is in control.

The result could deepen the country’s financial crisis in the near term and, if sanctions apply more broadly to any business dealings with the Taliban-controlled nation, Afghanistan could join North Korea and Iran as pariahs in the international financial system.

Heightened caution by banks risks slowing flows of money needed to carry on trade and other transactions. The decision by wire-transfer services Western Union Co. and MoneyGram International Inc. to stop doing business in Afghanistan restricts the flow of overseas payments that are a key source of support for many Afghan families.

Earlier guidance by the world’s terror-finance watchdog organization,...

Richard Branson’s Virgin Orbit said Boeing Co. will invest in the satellite-launching startup’s planned $3.2 billion SPAC listing later this year, an investment that comes as the plane maker’s own space program faces hurdles.

Virgin Orbit said it would list on the Nasdaq stock market by merging with NextGen Acquisition Corp., a special-purpose acquisition company run by former Goldman Sachs banker George Mattson and Greg Summe, a former senior executive at the Carlyle Group.

Boeing’s planned investment, which The Wall Street Journal first reported earlier Monday, comes through a SPAC-related fundraising round called a private investment in public equity, or PIPE. That fundraising has garnered a total of $100 million in commitments, Virgin Orbit said.

A Boeing spokeswoman declined to say how much it was investing. She said it was a strategic move and the Chicago-based company has a longstanding relationship with the Virgin Group. Boeing already has an...

This column is part of the Heard on the Street stock-picking contest. You’re invited to play along with us here.

Investors who think D.R. Horton ’s good fortunes can’t continue might need to stop worrying and learn to love the boom.

As the nation’s largest home builder, D.R. Horton has been well-placed to benefit from the wave of homebuying the pandemic set into motion. Operating in 30 states, it is an active builder in many of the suburban communities that people have been flocking to. Moreover, nearly one-third of the houses it builds come from its Express Homes division, which is aimed at first-home buyers such as the many members of the millennial generation who are now making the plunge.

This has been good for shares of D.R. Horton, which, though below the record they hit this spring, are about 50% above where they were before Covid-19 concerns hit the stock market in February 2020. One consequence is that D.R. Horton’s shares don’t look...

This column is part of the Heard on the Street Stock Picking Contest. You’re invited to play along with us here.

As the world moves on from the pandemic, investors may realize they aren’t dog people after all.

The surge in impulse pet adoptions fueled by Covid-19 makes even extravagant Christmas seasons look morally unimpeachable. Almost 13 million households in the U.S. got an animal companion between March and December of 2020, the American Pet Products Association says. Spending on veterinary practices has shot up this year, according to analytics firm VetSuccess.

Sitting at the intersection between markets’ obsession with growth stories and the vet boom is Seattle-based pet insurer Trupanion . Its shares have gained 250% in two years and trade at 13 times the firm’s tangible book value—insurers usually hover around one—even though it has rarely turned a profit since its listing in 2014.

Only 1% of pets in the U.S. have medical insurance,...