Berkshire Hathaway's $1 billion homebuilding investment indicates Warren Buffett's confidence in a future U.S. housing market rebound.

CSX and Burlington Northern Santa Fe announced a partnership on Friday, sending shares of CSX falling while the market roared higher. Investors were hoping for more. CSX stock dropped about $3 from its high for the day,

Buffett, through Berkshire, bought more than 5 million shares of the managed care company, worth an estimated $1.6 billion. Meanwhile, Michael Burry, who became famous in the book and movie The Big Short for his bet against subprime mortgages, bought 20,000 shares. Billionaire David Tepper also increased his stake in the name during the quarter.