Home builder stocks enjoy broad gains as Treasury yields fall to 1-month low
Shares of home builders were broadly higher Friday, as the continued drop in longer-term Treasury yields helped soothe some fears about home affordability. The iShares U.S. Home Construction ETF
ITB,
ran up 4.3% with all 47 equity components trading higher, while the S&P 500
SPX,
edged up 0.7%. PulteGroup Inc.
PHM,
was the biggest gainer of the group, rallying 7.0%, which would be the biggest one-day percentage gain since it surged 7.4% on Nov. 4, 2020. Among the sector ETF’s other more-active components, shares of Lennar Corp.
LEN,
climbed 5.2%, D.R. Horton Inc.
DHI,
hiked up 5.4%, Builders FirstSource Inc.
BLDR,
surged 6.4% and KB Home
KBH,
tacked on 4.4%. The yield on the 10-year Treasury note
TMUBMUSD10Y,
fell 8.4 basis points (0.084 percentage points) to a one-month low of 2.888%, and has dropped 59.5 basis points since it closed at an 11-year high of 3.483 on June 14, amid growing concerns over a possible recession. Meanwhile, lower Treasury yields lead to lower mortgage rates, which also lowers the cost of buying a home. Elsewhere, real estate services company Redfin Corp.’s stock
RDFN,
soared 8.6% on Friday.
