Although we don't believe in timing the market or panicking over market movements, we do like to keep an eye on big changes -- just in case they're material to our investing thesis.
What: Shares of homebuilders including KB Home
So what: The NAHB report showed that the homebuilder sentiment index rose to 18, above both the reading of 14 last month and the 15 that was expected. The level still suggests a very dour outlook -- anything below 50 means there is more pessimism than optimism -- but the direction of the move is a definite positive for an industry that has been absolutely ravaged since the housing market imploded.
Now what: As the yet-lackluster sentiment gauge suggests, there is still plenty of clawing back ahead for the beleaguered industry. While today's news may be a good step, there are plenty of other numbers that investors need to watch, including sales figures, inventories, and prices. The quick pop from an unexpectedly good NAHB report is the stuff that gets traders fired up, but for longer-term investors this isn't enough reason to jump in on today's action.
Want to keep up to date on these stocks?
Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors.
Fool contributor Matt Koppenheffer does not have a financial interest in any of the companies mentioned. You can check out what Matt is keeping an eye on by visiting his CAPS portfolio, or you can follow Matt on Twitter @KoppTheFool or Facebook. The Fool’s disclosure policy prefers dividends over a sharp stick in the eye.