Yields are back near where homebuilders' 59% rally began, but the Fed has flipped
ITB price against the 10-year Treasury yield, January 2023 through October 28, 2026
Silvia Insights research desk
For homebuilders, the yield level matters less than which way the Fed moves next.
In October 2023, the 10-year Treasury yield peaked at 4.98% and closed at or above 4.8% on just 12 days. Homebuilders (ITB) then rallied 59% into late March 2024 as yields fell and the Fed signaled cuts.
This time, the 10-year has closed at or above 4.8% for 38 straight sessions, including 4.94% on Oct 30. The Fed raised rates in September for the first time in more than three years, and two officials dissented in favor of another hike on Oct 28.
In 2023, homebuilders had the Fed on their side. This time they don't.
This chart comes from a new Silvia Insights research report. Members received the full analysis last week, including the actionable trade ideas, risks and what comes next.
Research is for informational purposes and does not constitute personalized investment advice.
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