Shares of Opendoor Technologies (OPEN 12.77%) were among the rare winners today as the meme stock jumped on the weaker-than-expected employment report.
While that might sound contradictory, stocks with exposure to the housing market mostly posted gains today as investors see the disappointing jobs growth over the last three months as evidence that the Fed could finally lower interest rates at its next meeting in September.
Opendoor stock finished the session up 14.2%.
Image source: Getty Images.
Could Opendoor finally catch a break?
The housing market has been nearly frozen since interest rates soared in 2022, which crushed the online home-flipper's business along with others that depend on real estate transactions.
The stock was trading below $1 this year before a meme stock rally pushed it higher, and the situation was bad enough that the company was considering a reverse stock split to remain listed with the Nasdaq.
Management has taken steps to streamline the business with layoffs and cost cuts, and it's slowing the pace of home purchases, but the company will likely need mortgage rates to fall and housing demand to strengthen in order to turn a profit.
Can Opendoor keep gaining?
Opendoor surged earlier in July on a meme stock rally and is still up about 300% from when that started, so its share price looks volatile.
The jobs report is just one data point, though it's likely to encourage the Fed to cut rates, especially if other data shows the economy is weakening.
Opendoor will report earnings next week, giving investors a view into its current prospects. Analysts are expecting revenue to be flat at $1.5 billion and for its loss per share to narrow from $0.04 to $0.02. The stock is likely to remain volatile, given the uncertainty in the macroenvironment and the recent interest from meme stock investors.
