Stocks of homebuilders and real estate services rise on surprise rise in new home sales

Shares of housing market companies rallied broadly on Friday after data showed new home sales surged surprisingly, and sharply, amid other signs of a slowdown in the housing sector. The SPDR S&P Homebuilders ETF XHB,
rose 2.9% in morning trade, with all 35 components trading higher. Among the most active homebuilders, shares of Lennar Corp. LEN,
increased by 2.1%, DR Horton Inc. DHI,
increased by 1.7% and PulteGroup Inc. PHM,
climbed 2.1%. Also in the homebuilder ETF, Home Depot Inc.’s HD stock,
gained 1.7% and Builders FirstSource Inc. shares BLDR,
jumped 6.3%. In real estate services, shares of Redfin Corp. RDFN,
jumped 2.4% and Anywhere Real Estate Inc. HOUS,
climbed 2.0%. The U.S. Commerce Department said on Friday new home sales rose 10.7% to a seasonally adjusted rate of 696,000 in May from a revised 629,000 in April, while expectations were for a drop to 587,000. against an initial estimate of 591,000 in April. This follows last week’s data that showed existing home sales fell for the fourth straight month and housing starts fell to a two-year low.