Anyone owning shares in homebuilders since late April/early May didn't need today's May New Home Sales report to show them that housing has been poor lately. As shown in the first chart below, the S&P 1500 Homebuilder index has declined 28.2% since peaking on May 3rd. And many of the key homebuilder stocks are off more than 40% from their 2010 highs reached just recently. Hovnanian (HOV) is down the most of any Russell 3,000 homebuilder stock from its 2010 high at 49.94%. Standard Pacific (SPF) is down 46%, while Beazer (BZH) is down the third most at 43%. The home buyer credit ended at the end of April, and homebuilder stocks have basically taken a straight line down since then. After the weak report came out this morning, homebuilders actually rallied and mostly closed up on the day. This is one situation where the news seemed to already be priced into the stocks.
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