What happened
House-flipping company Opendoor Technologies (OPEN 3.38%) was a sprightly stock at times this week. It was a yo-yo as far as its price was concerned; at one point it was up more than 15% over Friday's close, but had settled down to a 2.9% gain week to date Thursday night, according to data compiled by S&P Global Market Intelligence. Several dynamics were tugging the stock in various directions.
So what
The first occurred on Monday, when Morgan Stanley analyst Matthew Cost launched coverage on Opendoor stock. The prognosticator's recommendation on the shares was only equal weight (hold, in other words) with a price target of $4.25 per share.
Still, that was sufficient to bring fresh investor attention to the stock. What's more, the initiation of Opendoor coverage accompanied a broader take by Cost on the current state of the U.S. housing market.
The analyst believes that it's currently displaying signs of stabilization and that "this could point to a slow, volume-led but price-constrained recovery ... from here."
Now what
Cost's take came just days before another catalyst, the Federal Reserve's hiking of its benchmark federal funds rate to its highest level in 22 years. While the move was not necessarily a surprise to economists and investors, it wasn't great news for those in the real estate business. That's because the sector is very dependent on debt financing, and higher rates make such financing more restrictive.
It's too early to tell what effect the new rate hike will have on housing prices. That data should certainly be watched by Opendoor investors, not to mention others invested in real estate directly, or real estate (and adjacent) businesses.
