Home-improvement retailers Home Depot (HD: sentiment, chart, options) and Lowe's Companies (LOW: sentiment, chart, options) are down slightly this afternoon following a downgrade from "outperform" to "neutral" at Credit Suisse. "We believe that the stock prices already reflect a stronger recovery and better near-term margins than we believe they can achieve in 2009 or 2010 and we do not see the housing market returning to a state of equilibrium in 2009," said Credit Suisse analyst Gary Balter in a report. "2009 will be another very challenging year for home improvement and earnings will at best be flat, but more important, 2010 will not be a V-shaped recovery." The analyst also said both retailers were already seeing declining sales productivity before they were hurt by the housing slowdown.

The shares of HD are down only 0.28% this afternoon following the downgrade. There is also ample room for additional downgrades to weigh on the shares, as the stock has earned 6 "strong buy" ratings, 9 "holds," and just 2 "sell" ratings, according to Zacks. Technically speaking, the stock remains in an uptrend along its 10-day and 20-day moving averages trendlines that have supported the shares since mid-July. The stock is facing potential resistance at its declining 20-month trendline near the 31.60 region.

Meanwhile, LOW is down roughly 0.94% and is struggling to hold support at the 25 level, which is also home to the security's 20-day trendline. The stock has also been in an uptrend since mid-July. Analysts' sentiment is slightly more optimistic toward LOW. Zacks reports that the equity has been awarded 8 "strong buy" ratings, 2 "buys," 6 "holds," and 2 "sell" ratings.