Homebuilder stocks trade broadly lower, in wake of job cuts from Redfin and Compass

Shares of homebuilders traded broadly lower Tuesday, after two real estate companies announced job cuts, another sign suggesting the housing market has slowed. The iShares U.S. Home Construction ETF slumped 0.9%, putting it on track to close at the lowest price since Nov. 9, 2020. Among the sector tracker’s more active components, D.R. Horton Inc.’s stock shed 0.4% after CFRA analyst Kenneth Leon downgraded the home builder to hold from strong buy, and cut his price target to $80 from $100, citing an expected decline in home-buying demand as mortgage rates have climbed above 6%. Elsewhere, shares of KB Home dropped 1.7% and Lennar Corp. lost 0.8%. Also, home improvement retail giant Home Depot Inc. sank 1.5% toward the lowest close since March 15, 2021. Earlier, Redfin Corp. said it was cutting 470 jobs, or 6% of its workforce, and Compass Inc. said it was cutting 450 jobs, or 10% of its workforce. The home construction ETF has tumbled 36.1% year to date, while the S&P 500 has dropped 21.9%.

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