Builders' margins are expanding as they capitalize on higher prices and more demand, which have fueled the recent run-up in housing stocks. Toll Brothers, for one, reported a 36 percent jump in second quarter net orders last week. The luxury home builder has hiked prices approximately $26,000 per home in the current quarter.
"One year ago we were somewhat reluctant to raise home prices for fear of crimping demand," Toll Brothers CEO Douglas Yearley said in last week's earnings release. "Now we are finding that in many markets as prices increase, a sense of urgency takes hold and demand continues to rise."
Housing-related stocks have nearly quadrupled since their March 2009 low, but they're still about 30 percent below the July 2005 peak.
Traders say improved consumer confidence could attract more buyers, giving way for housing stocks to run even higher. May consumer confidence data is out at 10:00 a.m. ET. It's expected to show Americans feeling their best about the economy since October.
Tiffany opened at a 52-week high after the luxury retailer beat first quarter earnings and revenue expectations as sales increased across all regions. The high-end jeweler posted a profit of 70 cents per share, 18 cents above consensus. Sales jumped double digits in China, where Tiffany is expanding, after a slowdown in the world's second-largest economy weighed on revenues last year.
Last week, peers Signet Jewelers and Zale posted better-than-expected profits, but light revenues.
—By CNBC's Kristen Scholer. Follow her on twitter @KristenScholer