New York, Jan 14, 2026, 19:06 EST — After-hours
Shares of Home Depot (HD) slipped roughly 1% on Wednesday, ending at $375.95 in after-hours trading.
The home-improvement chain finds itself caught between rising mortgage rates and shifting consumer confidence. While increased housing activity can boost renovation spending, steep borrowing costs continue to discourage major projects.
Investors found new momentum in housing data. U.S. existing home sales surged 5.1% in December, hitting a seasonally adjusted annual rate of 4.35 million. The National Association of Realtors linked the rise to easing mortgage rates. “In the fourth quarter, conditions began improving,” said chief economist Lawrence Yun, though he flagged that inventory is still tight. Reuters
Home Depot’s stock dipped amid a broader Wall Street retreat, with banks and tech shares weighing on the market as investors shifted toward safer bets. Michael O’Rourke, chief market strategist at JonesTrading, noted, “After a nice run … you’re seeing profit-taking and consolidation.” Reuters
In home improvement, the tape was mixed. According to MarketWatch data, Lowe’s edged up a bit, but Home Depot slipped, roughly mirroring the S&P 500’s drop.
Rate expectations continue to drive housing-linked stocks. Yesterday’s data revealed the Consumer Price Index climbed 0.3% in December, with a 2.7% increase year on year. Core inflation stayed steady at 2.6%. The Federal Reserve is widely expected to hold its benchmark rate between 3.50% and 3.75% at the January 27-28 meeting.
Philadelphia Fed President Anna Paulson indicated Wednesday that “modest further adjustments” to interest rates might be justified later this year, provided inflation continues to ease and the labor market remains stable. She described her baseline outlook as “pretty benign.” Reuters
Home Depot is betting on whether any housing market improvement will hit its receipts soon enough to impact 2026 results. Back in December, the company offered a cautious outlook for fiscal 2026, predicting comparable sales — which exclude new store openings — to remain flat or rise up to 2%, with adjusted earnings per share expected to hold steady or grow as much as 4%.
But the recovery remains delicate. Home sales in 2025 hit their lowest point in 30 years, with analysts cautioning that prices might surge once more if supply doesn’t expand, despite easing mortgage rates.
The next major event for the stock is Home Depot’s earnings report on Feb. 24. Investors will be watching closely for signs of increased spending linked to housing turnover and financing trends.
