Mortgage stocks: UMW leads rally, Rocket falls as short-squeeze fades

Home Point Capital

03/03/2021 16:41

** Shares of some mortgage-based lenders rally in early
trade on Wednesday, a day after a short-squeeze in Rocket
Companies  RKT.N   urn:newsml:reuters.com:*:nL3N2L12TQ
    ** UWM Holdings Corp  UWMC.N , a mortgage provider which
went public through a $16 bln SPAC merger last year, jumps 8.5%
to $9.91
    ** Guild Holdings Co  GHLD.N  rise little over 1% to $16.67
    ** Rocket Companies  RKT.N , parent of mortgage lender
Quicken Loans, falls 18% to $34.13; stock was halted briefly for
volatility
    ** Weakness in RKT comes after Tuesday's >70% surge
    ** Wedbush Securities Managing Director Henry Coffey, who
covers the mortgage sector, says "one has to assume a
significant amount of profit taking" in the stock
    ** LoanDepot Inc  LDI.N , which had a lackluster debut last
month after slashing its IPO to less than a fifth of its
original offering, down 9.91% to $21.18
    ** Home Point Capital Inc  HMPT.O  dips 0.42% to $11.86
    ** A short-squeeze occurs when investors who hold
short-positions on stock are forced to buy back their shares
from the market in bid to cut further losses after such shares
rally
    ** Recent examples of short squeezes include stocks of
GameStop Corp  GME.N  and AMC Entertainment  AMC.N , fueled by
retail traders teaming up on social media forums to drive stock
prices up

 (Reporting by Sohini Podder in Bengaluru)
 ((sohini.podder@thomsonreuters.com))