Key Highlights

● Oppenheimer lowered its rating on Equifax to Perform from Outperform.

● Third-quarter results arrive Oct 20 before the opening bell.

● Mortgage lending activity is a key driver of demand for Equifax's credit data.

● The S&P 500 fell 84.62 points to 7,659.44 as six of 11 sectors rose.

The downgrade

Equifax (NYSE:EFX) was in focus on Friday after Oppenheimer downgraded the stock to Perform from Outperform, according to market reports. The call arrived days before Equifax reports third-quarter results on Oct 20, before the opening bell.

Reports on the stock's direction during the day were mixed. Market data showed that Equifax shares jumped early in the session, though no catalyst was cited for the move.

Equifax, based in Atlanta, is one of the three major US consumer credit bureaus, alongside Experian and TransUnion (NYSE:TRU). It collects and analyzes credit and employment data, selling credit reports, scores and verification services to lenders, employers and government agencies. Its Workforce Solutions unit, which verifies income and employment, is a major contributor to revenue. Mortgage lending activity is a key driver of demand for its credit data, which ties the business to interest rates and the housing market.

Credit data peers

Market data also named Fair Isaac (NYSE:FICO), the company behind the widely used FICO credit score, among the day's gainers, without citing a catalyst. Credit bureaus and scoring companies sit at the center of consumer lending, supplying the data that banks, card issuers and mortgage lenders use to approve loans and set terms.

Rates and housing

Equifax's business is sensitive to borrowing costs because higher mortgage rates tend to reduce home purchase and refinancing activity. The 10-year Treasury yield, a benchmark for mortgage rates, eased to roughly 5.1 on Friday and fell for the week, after topping 5.3 earlier in October, its highest level since 2002, per market reports.

Housing-related stocks were under pressure. Opendoor Technologies (NASDAQ:OPEN), Offerpad (NYSE:OPAD) and Compass (NYSE:COMP) all fell as the Primary Consumer Sentiment Index dropped 5.3 points to 45.2, its lowest since October 2011, and higher yields weighed on financed purchases, according to market commentary.

The Federal Reserve raised rates a quarter point in September, its first hike in three years. Chair Kevin Warsh, speaking at an IMF gathering in Bangkok, declined to preview the October decision. "I don't prejudge meetings," he said. Odds of an October hike fell sharply after spiking on Wednesday's hot consumer price data, though markets still price a hike by December.

The broader market

The S&P 500 fell 84.62 points to 7,659.44, the Dow Jones Industrial Average lost 175.28 points to 52,002.41 and the Nasdaq Composite slid 572.99 points to 26,140.03. Technology led the declines on concerns about how the artificial-intelligence build-out will be financed, while energy, utilities, consumer staples, health care and financials rose. Six of the S&P 500's 11 sectors finished higher, according to market data.

Financials drew particular interest as regional banks reported results. Truist (NYSE:TFC), Regions (NYSE:RF), M&T (NYSE:MTB) and Citizens (NYSE:CFG) all released third-quarter numbers Friday. Reports indicated that regional banks are seeing resilient loan growth, with lending tied to the AI build-out cited as a factor. Healthy loan demand is generally a supportive sign for companies that sell credit data to lenders.

Equifax Earnings and Housing Data Ahead

Equifax reports Oct 20 before the open. Investors will look for updates on mortgage-related revenue, the Workforce Solutions business and full-year guidance. The same day brings September housing starts and building permits, a timely read on the housing market. MSCI (NYSE:MSCI) reports Oct 20 and Moody's (NYSE:MCO) on Oct 21, rounding out a busy week for financial data providers. The Fed's Oct 28 decision is the main macro event.