Shares of Rocket Companies (RKT) surged 13.5% to $15.29 by late Wednesday morning, outperforming major mortgage lending peers after the latest industry data signaled a modest uptick in U.S. home-loan demand. The stock opened at $13.90 and touched an intraday high of $15.36, reflecting renewed investor optimism around the housing finance sector.
Rocket’s gains outpaced rivals UWM Holdings (UWMC), which added 4.4%, and loanDepot (LDI), which moved up 7.9%. The rally came as the Mortgage Bankers Association (MBA) reported that total mortgage application volume rose 1% for the week ending June 19, reversing the prior week’s 3.8% decline. Refinance activity posted a 3% increase, while purchase applications slipped 0.6%.
The 30-year fixed mortgage rate edged down one basis point to 6.59% in the MBA’s latest survey. Separately, Freddie Mac’s weekly average for the same loan stood at 6.47% as of June 18, down from 6.52% the week prior and significantly lower than the 6.81% recorded a year ago. The decline in borrowing costs has provided some relief to potential homebuyers and refinancing households.
Redfin Data Shows Steady Home Prices
Redfin, a Rocket-owned real estate brokerage, reported that U.S. home prices edged up 0.3% in May compared to April, bringing the year-over-year increase to 2.5%. The Redfin Home Price Index tracks changes by comparing the prices of the same homes sold over time. “Buyers got a boost from lower mortgage rates in the spring, and that momentum is showing up in prices,” said Sheharyar Bokhari, senior economist at Redfin.
Rocket is actively working to capture more mortgage business from Redfin’s home-search users, aiming to keep borrowers within its platform from the initial search through loan closing. In its first-quarter earnings report, Rocket posted net revenue of $2.94 billion, net income of $297 million, and closed mortgage origination volume of $44.7 billion. Its servicing portfolio reached $2.1 trillion, representing 9.4 million loans. “We’re not waiting for the market to get easier,” CEO Varun Krishna stated, underscoring the company’s proactive strategy.
Options Activity and Market Sentiment
Rocket saw a notable surge in options trading, with some traders betting on further upside. According to TipRanks, citing data from The Fly, 23,387 Rocket call options changed hands—roughly double the normal volume. The put/call ratio stood at 0.03, indicating overwhelmingly bullish sentiment. Calls gain value when the stock climbs, while puts benefit from declines.
However, the housing market outlook remains mixed. Reuters reported Wednesday that new U.S. single-family home sales dropped 7.3% in May to a seasonally adjusted annual rate of 580,000 units. Higher mortgage rates and elevated home prices have caused many prospective buyers to pause. If demand for new purchases remains soft, Rocket may need to rely more heavily on refinancing and servicing income, with new loan growth likely uneven in the near term.
