NEW YORK (
) -- The housing hoopla, which has resulted in a run-up in share prices of several homebuilders, might well be dying down.
Two homebuilders --
-- were downgraded by a Stifel Nicolaus analyst on Wednesday to sell from hold.
The downgrade sent shares of the sector in the red in morning trading. Toll Brothers fell 3% to $21.35,
shed 1% to $12.22,
dropped 2% to $16.65 and
slipped 1% to $13.01.
Mad About Options: Confident About Toll Brothers
Analyst Michael Widner said D.R. Horton is a "strong competitor" in the sector, but its stock has risen 45% since its recent low on July 8. He doesn't believe the company's fundamentals will drive any more big moves in the stock price.
Similarly, shares of Toll brothers are up 40% since early July.
Shares of homebuilders have been on the upshoot since July's better-than-expected housing data, which signaled a possible turn-around in the sector. Median prices grew, some homebuilders reported better-than-expected quarterly earnings, and pending home sales jumped.
But on Tuesday, the good news started to wane. The Commerce Department said
in July to 581,000 units, missing economists' expectations of 600,000 new units.
Building permits, which help gauge future activity, also fell 1.8% in July to 560,000. Economists expected a 0.5% increase to 573,000.
-- Reported by Jeanine Poggi in New York.
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