Biggest Drop in Over 50 Years! Weak United States Housing Market "Bloodbath" Hits Australia Building Materials Stocks, Pipeline Giant Reece Plummets

Reece Ltd has experienced the largest decline on the Australian stock market in nearly fifty years, due to the Australian pipe supply company announcing a drop in its full-year profits and warning that the US housing market remains persistently weak. Although Reece achieved a "decent" performance in a tough environment, Citi analysts pointed out in a report that "the US macroeconomic situation remains a worrying issue." According to collected data, approximately 57% of the company's revenue comes from the United States.

The company’s share price plummeted by as much as 22%, marking its biggest drop since June 1978. This followed a 24% decline in annual net profit to AUD 316.9 million (approximately USD 205 million) for the year ended June 30, which fell short of analysts’ expectations. The company also stated that, given affordability issues, the U.S. real estate market is expected to remain constrained over the next 12 to 18 months.

Reece's cautious attitude echoes warnings from numerous companies involved in the U.S. real estate market. James Hardie Industries, a company listed on the Sydney Stock Exchange, experienced its worst performance in half a century last week because the building materials manufacturer warned of weak real estate demand. James Hardie Industries Plc, a pipe products company, also saw its stock price impacted as the company indicated poor sales prospects.