Homebuilder exchange traded funds were higher in early trading Thursday after the Commerce Department said housing starts climbed 12.1% last month.
New construction rose to the highest level since June 2008, MarketWatch reports.
The iShares DJ US Home Construction (NYSEArca: ITB) and SPDR S&P Homebuilders ETF (NYSEArca: XHB) traded higher in premarket action after the report. The ETFs rose 79.4% and 57.3%, respectively, in 2012, according to Morningstar. Builder stocks have enjoyed a huge rally the past year on hopes the housing market is on the mend after the subprime crash. [Homebuilder ETFs Breaking Out on Budget Deal Optimism]
The National Association of Home Builders/Wells Fargo Housing Market Index released earlier this week revealed builder confidence continues to hold at its highest level since April 2006.
“Conditions in the housing market look much better now than at the beginning of 2012 and an increasing number of housing markets are showing signs of recovery, which should bode well for future home sales later this year,” said Barry Rutenberg, chairman of the NAHB.