Sector Update: Housing Stocks Break 3-Day Slump As 10-Year Yield Returns to Sub-2.60%


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Falling mortgage rates and a rebound in the bond market is giving a boost to the homebuilder sector with stocks gaining 1-2% this afternoon. Last Thursday, Freddie Mac reported that the 30-year fixed mortgage rate fell to 4.10%, a four-month low and its second consecutive decline. This came on a decline in the 10-year yield from its mid-October high of 2.75% to 2.51% one week later.

The strength in the homebuilder sector is also attributed to expectations for strong Q3 earnings from DR Horton and Taylor-Morrison, both of whom report on November 12. Despite recent declines in pending home sales and existing home sales due to slightly higher mortgage rates in September, most of the larger homebuilders are expected to post double-digit growth for Q3.

Shares of Pulte Group are 2% higher at near $18.00 with a 52-week range of $14.23 to $24.47.

The Ryland Group is up 2% to near $40 with a 52-week range of $29.63 to $50.42.

DR Horton is near 2% higher at $18.85 with a 52-week range of $17.52 to $27.74.

Finally, KB Homes is 1.5% higher with a 52-week range of $13.09 to $25.14.

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

Copyright (C) 2014 All rights reserved. Unauthorized reproduction is strictly prohibited.

This article appears in: Investing , Commodities

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