15 C
London
Sunday, May 19, 2024
HomeBusinessStocks give up gains as bond yields rise.

Stocks give up gains as bond yields rise.

Date:

Related stories

spot_img

Homebuilder stocks experienced a decline on Monday as the National Association of Home Builders (NAHB)/Wells Fargo Housing Market Index (HMI) remained unchanged at 51 in April, after four months of gains. This stagnation in sentiment indicates potential demand growth, but buyers are cautious due to uncertainty surrounding interest rates. NAHB chief economist Robert Dietz noted that buyers are hesitant to make decisions until they have a clearer picture of where mortgage rates are headed.

Major homebuilders like Lennar, Pulte, and Toll Brothers all saw their stocks drop over 1% mid-morning, while the SPDR S&P Homebuilders ETF was down 0.3%. The flat confidence level among builders reflects a market where buyers and sellers are staying put amidst high home prices and limited housing stock. This comes as investors have scaled back rate cut expectations following a higher-than-expected inflation reading, although Dietz still anticipates future rate cuts from the Federal Reserve later this year.

The slight increase in mortgage rates, with the average 30-year fixed rate rising to 6.88%, has caused borrowers to pause just as the spring homebuying season is picking up. Builders have also slightly decreased the number of price cuts on homes, and the use of sales incentives has also decreased. Despite the current challenges in the housing market, there is optimism that the Federal Reserve will announce rate cuts later in the year, potentially leading to more moderate mortgage rates in the second half of 2024.

Source link

Subscribe

- Never miss a story with notifications

- Gain full access to our premium content

- Browse free from up to 5 devices at once

Latest stories

LEAVE A REPLY

Please enter your comment!
Please enter your name here