Sector Snap: Homebuilders slide on pending sales data
NEW YORK—Housing stocks turned mostly lower Wednesday on more industry data showing the sector's swoon worsened earlier this year.
D.R. Horton Inc., one of the largest builders, paced the losers, dropping 73 cents, or 4 percent, to $16.12. The company reported a fiscal-second-quarter loss Tuesday
Centex Corp. and Hovnanian Enterprises Corp. each recently reported quarterly losses, but their shares rose as each generated more cash flow by cutting prices. Both stocks registered declines Wednesday.
They sector reacted to an industry report that pending U.S. home sales fell to a new low in March.
The National Association of Realtors' seasonally adjusted index of pending sales for existing homes fell to 83.0 from a downwardly revised February reading of 83.8, the index's previous low.
Falling home prices and a tight credit environment have pummeled the housing market and sent potential buyers to the sidelines to wait out the slump.
With demand continuing to ebb, price declines continue around the country. On Tuesday, government-sponsored mortgage lender Fannie Mae said home prices fell in the first quarter "faster than anyone anticipated." The company now expects a decline of 7 percent to 9 percent for the year, compared with earlier forecasts of a 5 percent to 7 percent drop.
Fannie reported a $2.2 billion loss on increased bad loans.
