Sector Snap: Shares of homebuilders inch lower
Homebuilder stocks lose ground on concerns housing market recovery could be losing steam
NEW YORK (AP) -- Shares of homebuilders edged lower Wednesday on concerns that the housing market could be cooling off.
On Wednesday, the National Association of Realtors said its seasonally adjusted index for pending home sales declined by a small amount in July, meaning fewer Americans signed contracts to buy homes. On Tuesday, the Standard & Poor's/Case-Shiller 20-city home price index rose, but month-over-month price gains slowed in most markets.
The housing market has improved as the U.S. economy has gained strength and both indexes are close to multiyear highs. But there have been signs those gains are slowing down: Mortgage applications from potential buyers have fallen because interest rates went up, and in July, builders started work on the fewest single-family homes in eight months. As a result, many homebuilder stocks have slumped in the last month.
In afternoon trading Wednesday, shares of Beazer Homes USA Inc. lost 29 cents to $17.23 and Hovnanian Enterprises Inc. stock fell 8 cents to $5.16. Lennar Corp. shares declined 42 cents to $31.85 while Toll Brothers Inc. shares dipped 16 cents to $30.68 and PulteGroup Inc. gave up 17 cents to $15.42. M.D.C. Holdings Inc. stock shed 13 cents to $28.35 and KB Home skidded 29 cents to $15.99.
Ryland Group Inc. shares sank 5 cents to $34.36 and shares of Meritage Homes Corp. were down 23 cents at $39.06. Standard Pacific Corp. stock slipped 8 cents to $7.17 and D.R. Horton Inc. retreated 28 cents to $17.71.
