Shares of home improvement chains dipped Wednesday after the federal government said construction of new homes and apartments slowed at a record pace in October.

A 4.5 percent drop to an annual rate of 791,000 units illustrates the severity of the housing slump and signals that the worst may not yet be over.

Shares of The Home Depot Inc. fell 40 cents to $20.31 in afternoon trading while Lowe's Cos. Inc. slipped 49 cents, or 2.5 percent, to $18.61.

The two companies reported better-than-expected third-quarter results this year, but both posted dramatic profit decreases and said sales worsened in the early parts of November.

"Both Lowe's and Home Depot saw sales, margins and earnings take another leg down from the weak prior-year quarter," Gimme Credit analyst Carol Levenson told investors in a research note on Wednesday. "With the slump in big ticket remodeling purchases continuing, about all either company can point to with pride these days is market share, and both claimed to gain unit market share in roughly half their merchandise categories during the third quarter."

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