Home Builders: Beaten Down and Looking Up? |
| Wall Street Journal - Aug 16, 2010 |
Sentiment surrounding home-builder stocks remains in the dumps, but some technicians and analysts are seeing glimmers of hope in the sector.
The National Association of Home Builders said Monday that home-builder confidence in August plunged to a 17-month low, at least partly due to a slumping labor market and broader concerns about the recovering economy.
The negative view surrounding housing is nothing new, but it has been particularly downbeat since April, when the home-buyer tax credit expired, and the SPDR S&P Homebuilders Select Industry Index exchange-traded fund (trading symbol XHB) topped out at $20.
The ETF has since significantly underperformed the broader market, falling 29% while the Standard & Poor's 500 index has declined 11%. After such a precipitous drop, the ETF is inching closer to some key support levels.
Katie Stockton, chief market technician at MKM Partners, wrote recently that the "risk/reward is currently favorable for the XHBs," as the recent pullback has brought the ETF closer to some areas of support.
Read Full Article from Wall Street Journal
- Posted: 2010-08-16 20:57:54
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