Homebuilder stocks led Tuesday gains with sector-related ETFs breaking above their short-term trend lines after Toll Brothers (NYSE: TOL) beat second quarter earnings expectations.

On Tuesday, the iShares U.S. Home Construction ETF (NYSEArca: ITB), the largest homebuilder-related ETF, jumped 3.7% and the equally weighted SPDR S&P Homebuilders ETF (NYSEArca: XHB) rose 2.6%. Both ITB and XBH broke above their short-term resistance at the 50-day simple moving average.

Fueling the surge in homebuilders, Toll Brothers revealed profits rose 30% in its latest quarter on strong growth in deliveries and ongoing deals with customers, reports Kimberly Chin for the Wall Street Journal.

TOL shares surged 13.8% Tuesday. TOL makes up 4.5% of ITB’s underlying holdings and 4.0% of XHB’s portfolio.

Toll is one of the country’s largest builders of luxury homes. The home construction company benefited from low housing inventory and strong activity among affluent consumers.

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