Interesting change in direction for the homebuilder stocks. This morning we got news that New Home Sales were at an all time low or at least recorded low. Wouldn't you expect a huge selloff in homebuilding stocks? Having a few portfolios geared towards risk, I don't have any interest in buying a homebuilder yet evidently some investors are trying to catch the bottom. While todays numbers do suggest a potential bottom with nowhere to go but up, the sector could bleed for years at these low levels as Existing Homes and especially foreclosures are burned off. Why buy a new home with cheap existing homes all around?
Ryland (RYL) is up 4% while Toll Brothers (TOL) and DR Horton (DHI) are both up 2%. Interesting trading indeed.