Shares of U.S. homebuilders and other real estate-related companies fell sharply on Wednesday after home improvement retailer Lowe's indicated that interest rates and other pressures continue to weigh on home sales. Several stocks were among the biggest percentage decliners in the S&P 500 index that day, contrasting with the broader market's 0.8% gain. Data showed Lowe's dropped 5.6%, Lennar fell 4.9%, PulteGroup declined 4.7%, D.R. Horton slid 4.0%, and building materials supplier Builders FirstSource plunged 6.4%. Additionally, the S&P 1500 Homebuilding Index fell 3.7%, hitting a three-week low, while the Philadelphia Housing Sector Index dropped 3%. Lowe's provided full-year sales and profit guidance that fell short of market expectations. The company's CEO Marvin Ellison stated on an earnings call that consumer confidence remains "depressed" due to inflationary pressures and overall economic uncertainty. Ellison noted that "persistent lock-in effects" continue to pressure housing turnover and new home construction. As a result, he said Lowe's expects "improvement in the housing and home improvement markets will be gradual." This followed comments from Home Depot's CFO Richard McPhail on Tuesday, who said U.S. consumers have been in what he described as a "frozen housing environment" since 2023, with no significant improvement yet. Home Depot's shares fell 2.3% on Wednesday after rising about 2% on Tuesday. Data released Wednesday showed the average rate on the 30-year fixed mortgage fell 8 basis points to 6.09%. However, mortgage applications for home purchases—one of the most forward-looking indicators for the housing market—declined 4.7%. The U.S. housing market has struggled due to limited supply, high borrowing costs, and rising construction expenses, with existing home sales in January dropping to their lowest level in over two years. In his State of the Union address Tuesday evening, President Trump reiterated plans to limit the number of homes large corporations can own. Reacting to the announcement, Jack Dollarhide, CEO of Longbow Asset Management in Tulsa, Oklahoma, said, "One might think the president's remarks about banning big firms from buying homes would be positive for homebuilders, but the stock declines may reflect the 'distorted situation' the housing market is in. Interest rates are too high. People are trapped in their homes, prisoners of 1%, 2%, or 3% mortgage rates—they can't move."