The stock markets shook off negative jobs and consumer spending reports to stage a broad-based rally on Thursday, sending the Dow Jones Industrial Average up 1.67%, or 207.53 points, the NASDAQ up 1.74% and the S&P 500 up 1.68%. The catalyst was an assurance from bond insurer MBIA that it would maintain its triple-A credit rating.
Builder stocks took off, with the S&P home builder ETF (AMEX:XHB) closing up 8.11% to $22.00.
That, however, was a minor gain compared to individual builder stocks, many of which are still heavily shorted, which tends to magnify upward swings as short holders scramble to cover their positions. Lowly Comstock (NASDAQ:CHCI), a penny stock that has been notified that it is in danger of delisting, shot up 47.3%, leading the group, although its gain was all of 35 cents to $1.09. Orleans (AMEX:OHB) nearly pulled itself out of penny stock territory, rising to $4.99, up 21.7% (a penny stock is normally defined as a stock that sells for less than $5 per share, the threshold at which most institutions will consider investing).
Several of the big players were up sharply as well. At one point in early afternoon, Standard Pacific (NYSE:SPF) was leading all gainers on the Big Board. It closed up 22% at $3.76 on moderately heavy volume. Pulte Homes (NYSE:PHM), after announcing disappointing earnings for the fourth quarter, shot up 20.5% to $16.35. Meritage ((NYSE:MTH), which earlier in the week reported a disappointing quarter, was up 17.8% to $16.04. WCI (NYSE:WCI) was up 15.9% to $6.05; Brookfield (NYSE:BHS) up 15.2% to $16.95; Hovnanian up 14.17% to $9.99; Lennar (NYSE:LEN) up 12.9% to $20.54; Beazer (NYSE:BZH) up 12.7% to $8.71; Ryland (NYSE:RYL) up 12.4% to $33.77; and D.R. Horton (NYSE:DHI) was up 10.5% to $17.26.
Among the less leveraged companies in the group, KB Home (NYSE:KBH) was up 9.2% to $27.50. The rest of the group was up in the 4% to 6% range, with NVR (NYSE:NVR), which this week reported a profitable quarter, up 4.7% to $631.50.