U.S homebuilders rise as yields fall after jobs report

LGI Homes

06/09/2024 15:34

** Interest rate-sensitive homebuilders stocks rise on Fri
after Aug payrolls report misses expectations, sending yields
lower
    ** Markets pricing in about 50/50 odds of 25 or 50 basis
points rate cut at Fed's Sept meeting; lowering rates leads to
decline in mortgage rates, potentially benefiting homebuilders
    ** PHLX Housing Index  .HGX  up 1% on the session: Toll
Brothers  TOL.N , Meritage Homes  MTH.N  2.4%, Pultegroup
 PHM.N , Lennar  LEN.N , and DR Horton  DHI.N  all up about
1.4%-2.4%
    ** In S&P 500  .SPX , building products maker Builders
FirstSource  BLDR.N  up 1.4%, while home improvement retailers
Home Depot  HD.N  and Lowe's  LOW.N  both edge up less than 1%
    ** Benchmark U.S. Treasury 10-year yield  US10YT=RR  on Fri
fell as low as 3.657%, lowest since Jun 2023
    ** With moves on Fri, HGX up ~17% YTD vs ~14% rise in S&P
500  .SPX 

 (Lance Tupper is a Reuters market analyst. The views expressed
are his own)
 ((lance.tupper@thomsonreuters.com
lance.tupper@tr.com 1-646-279-6380))