June 21, 2024

Solid State Lighting Design

Find latest world news and headlines today based on politics, crime, entertainment, sports, lifestyle, technology and many more

The S&P 500 fell below 5,100 as big technology companies lead stocks' decline

The S&P 500 fell below 5,100 as big technology companies lead stocks' decline

Homebuilder stocks fell on Monday after a closely watched housing sentiment index broke a four-month streak of gains amid rising mortgage interest rates.

The National Association of Home Builders (NAHB)/Wells Fargo Housing Market Index (HMI) held steady at 51 in April, unchanged from March. Any number over 50 certainly indicates that more builders view conditions as good than bad.

“A flat reading for April suggests there is potential for demand growth, but buyers are holding off until they can better gauge which direction interest rates are headed,” NAHB chief economist Robert Dietz said in a statement.

Lennar (LEN), Pulte (PHM), and Toll Brothers (TOL) were all down more than 1% mid-morning, while the SPDR S&P Homebuilders ETF (XHB) was down 0.3%.

The steady level of confidence among builders underscores the number of potential buyers and sellers, already dealing with rising home prices and limited housing stock, who are still in place. It comes after last week's higher-than-expected inflation reading prompted investors to reduce the number of interest rate cuts they see this year to two, fewer than the average of three the Fed expected at its March meeting.

“With markets now adjusting to the rise in interest rates somewhat due to recent inflation readings, we continue to expect that the Federal Reserve will announce future interest rate cuts later this year and that mortgage rates will moderate in the second half of 2017,” Dietz said. 2024″.

Mortgage rates remained slightly higher compared to the beginning of the year, pushing borrowers to the sidelines as the spring homebuying season begins. The average interest rate on a 30-year fixed mortgage rose to 6.88%, up from 6.82% the previous week. Freddie Mac reported.

See also  Exceeds expectations, reduces exposure to Russia

In April, builders held back slightly from reducing house prices, with 22% of builders reporting doing so, down from 24% in March and 36% in December last year.

Meanwhile, sales incentive use fell to 57% in April from a reading of 60% in March.