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After many failed turnaround attempts, it appears the housing sector may finally have a foundation under it once again. Existing-home sales ticked higher by 2.8% in August to an annual rate of 4.82 million units -- the fastest rate reported since May 2010. This news also came on the heels of a 5.5% increase in single-family home construction. Driven by the prospect of stabilizing home prices, the S&P 500 (INDEX: ^GSPC ) rose by 1.73 points (0.12%) to 1461.05. Let's have a look at a few notable movers within the S&P 500 today.
Companies that helped the S&P 500
As should be no surprise, the sector leading today's rally higher is homebuilders, led by the largest builder in the U.S., D.R. Horton (NYSE: DHI ) , up better than 4%. D.R. Horton reported a 25% increase in new-home orders in its most recent quarter and has been commanding better pricing power, which has helped its homebuilding margin. My Foolish colleague Andrew Tonner has been notably optimistic about a housing recovery and recently outlined his reasons that this rebound could be the beginning of a long-term uptrend in housing.
Regions Financial (NYSE: RF ) , whose loan portfolio was hit particularly hard during the housing downturn, is a side beneficiary of today's housing data. In addition to Regions' repayment of its TARP loans and a drastic improvement in its credit quality, today's data suggest that the housing market is stabilizing, which could be construed as a positive for homeowners currently underwater and struggling with their payments, as well as for Regions' commercial mortgage portfolio. Regions tacked on 5% today.
Companies that hindered the S&P 500
Chip-equipment manufacturers had a particularly rough day, with KLA-Tencor, Applied Materials, and Lam Research (Nasdaq: LRCX ) all heading decisively lower following negative comments from Citigroup. Blaming Apple for a fabless semiconductor production shift to Taiwan Semiconductor from Samsung, Citigroup analyst Terence Whalen cut estimates across the sector and dropped Lam Research to a "hold" from a "buy." Consider me unconcerned about today's ratings change, however, as I opined earlier in the week why Lam Research could be an excellent pickup near its 52-week low.
Waste Management (NYSE: WM ) also found itself being trashed by JPMorgan Chase, which lowered its rating on the waste-management and recycling company to "underperform" from "neutral" while dropping its price target to $34. JPMorgan cited volatile commodity prices as the impetus for the downgrade that sent the stock down nearly 4%. I, for one, am siding with Fool Alyce Lomax and see considerably more upside than downside for Waste Management.
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