Home Depot shares advanced 0.7% to $385.15 on Friday, trailing the wider market surge that propelled the Dow Jones Industrial Average above the 50,000 milestone. The home improvement retailer's modest gain contrasted with the S&P 500's nearly 2% climb and a 1.2% rise for rival Lowe's.
Macroeconomic Catalysts Ahead
Attention now shifts to upcoming economic indicators that could influence interest rate expectations and housing market dynamics. The Labor Department will release January employment figures on February 11, followed by Consumer Price Index inflation data two days later. These reports will help shape forecasts for Federal Reserve policy and mortgage rate trends.
Home Depot has consistently highlighted challenges in the housing sector, with Chief Financial Officer Richard McPhail noting in December that the company had "not yet seen a catalyst or an inflection in housing activity." Elevated borrowing costs and persistent home prices have constrained buyer activity and delayed major renovation projects.
Key Metrics for Quarterly Results
When Home Depot reports fourth-quarter earnings on February 24, analysts will scrutinize comparable store sales—which exclude impacts from store openings and closures—alongside average transaction values, customer traffic patterns, and professional segment performance. Margin pressures, promotional activity, and inventory management will also be in focus.
The broader home improvement sector, including building product manufacturers and tool companies, typically moves in correlation with interest rate sentiment and homeowner equity confidence. Stronger-than-expected inflation or employment data could dampen expectations for near-term rate cuts, potentially renewing pressure on mortgage rates and discretionary remodeling spending.
Investors will seek clarity on Home Depot's fiscal 2026 outlook and any indications that the long-anticipated housing market inflection point may be materializing in store-level performance.
