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Housing-related equities posted sharp gains on Thursday. The move was driven by a decline in bond yields that followed a sell-off in technology stocks. Zillow (Z) shares rose 11%, while Opendoor (OPEN) surged 17%.
Online brokerage Compass (COMP) jumped nearly 10%, and commercial real estate database CoStar (CSGP) increased by more than 6%. The movement reflects the direct link between mortgage rates and government debt yields.
Investors had previously avoided US government debt, which pushed yields and mortgage rates higher. However, the retreat from chip stocks on Thursday prompted a return to Treasurys as a safe-haven asset.
As bond prices and yields move inversely, the increased demand for long-dated government debt caused yields to fall sharply.
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