Daily Recap: Real Estate Rally | Oil Retreats | Confident Homebuilders

September 17, 2019 | Hoya Capital

Daily Recap: Real Estate Rally | Oil Retreats | Confident Homebuilders Uncategorized Sep 17 Written By Following yesterday's historic surge in crude oil prices following this weekend's drone attacks on Saudi Arabia's oil industry, oil futures and oil-tracking ETFs (USO) retreated by more than 4% on reports that oil production will be brought back online to pre-attack levels "within weeks." Perfectly offsetting Monday's declines, the S&P 500 ETF (SPY) climbed by 0.3% and the Nasdaq ETF (QQQ) gained 0.5% on the day.

Ahead of a critical Fed meeting tomorrow in which the committee is expected to cut short-term rates by 25 basis points, the 10-year yield retreated by 3 basis points, finishing the day at 1.81%. Coming off a 1.0% gain yesterday, the broad-based REIT ETF (VNQ) added to it's weekly gains, climbing by 0.9%. Gains in the REIT sector were led by the cell tower, healthcare, and net lease REIT sectors with strong individual performances from Crown Castle (CCI), Ventas (VTR), HCP (HCP), and SBA Communications (SBAC).

The hotel and mall REIT sectors were the relative laggards on the day with weak performance from retail REITs Washington Prime (WPG), Tanger (SKT), and Taubman (TCO). The Hoya Capital Housing Index , the industry benchmark that tracks the GDP-weighted performance of the US housing industry, finished the day higher by roughly 0.4%, led to the upside by the Residential REIT and Homebuilding sectors. KB Home (KBH), Tri Pointe (TPH), Whirlpool (WHR), and Meritage (MTH) were among the individual best-performers on the day following better-than-expected homebuilder sentiment data.

The Real Estate Brokerage & Technology sector was the relative laggard on the day. With the slower-reacting data finally beginning to see the positive effects of lower mortgage rates, the more forward-looking housing market indicators continue to point to a solid back-half of 2019. Ahead of the closely-watched housing starts data tomorrow and existing home sales data on Thursday, homebuilder sentiment climbed to the ...