Investing.com - Home builders were on the back foot midday Wednesday on fears a rising interest rate environment could put the brakes on an already slowing U.S. housing market.
KB Home (NYSE:KBH) led the decline with a 5% slump as investors fled home builders just hours ahead of a widely expected interest rate hike from the Federal Reserve, which is likely to rein in the availability of cheaper mortgage rates, reducing home buying activity. KB Home was up before the bell after it beat earnings expectations Tuesday, but then sank on negative analyst commentary.
Homebuilders Toll Brothers (NYSE:TOL) and DR Horton (NYSE:DHI) were the other notable decliners.
Energy was also a notable decliner, weighing on the broader market following mostly bearish petroleum report from the Energy Information Administration released Wednesday, showing domestic crude inventories fell more than expected.
Health care names, meanwhile, continued the trend of delivering outsized gains so far this week as Alexion Pharmaceuticals (NASDAQ:ALXN), led the S&P 500, rising nearly 6% after reaching an agreement to buy Syntimmune for a total value of up to $1.2 billion.
Aldeyra (NASDAQ:ALDX) was also a standout performer with an eye-popping 56% surge after its positive trial results for its dry eye disease drug, prompted analysts to wax lyrically about the outlook for the drugmaker.
"We believe today's data readout kicks off 12 months of significant catalysts for Aldeyra's lead programs," Janney Capital said.
The S&P 500 health care sector was up about 0.7%.
In tech, shares of GoPro NASDAQ:GPRO) got some love from Wall Street and surged 13% as Oppenheimer declared that the camera maker had turned a corner following a successful turnaround plan.
“GoPro has never had competitive issues. Its stock depreciation has largely been self-inflicted or moonshots that didn’t land. It’s arguably been left to the scrap heap. We believe it’s worth a second look based on the set-up and management’s turnaround efforts,” Oppenheimer said.
Elsewhere, eBay (NASDAQ:EBAY) stock caught a bid, rising 4%, a day after the e-commerce company showed progress on life without payments provider PayPal, announcing that it would manage payments on its own through the eBay website.
The S&P 500 tech sector was up about 0.24%.
On the mergers front, Viacom (NASDAQ:VIAB) racked up gains as rumors swirled that merger talks with CBS Corporation (NYSE:CBS) were set to resume.