Home Depot and Sears Holdings - two of the three largest US retailers - have both issued gloomy earnings forecasts that in part reflect the impact on their businesses of the downturn in the US housing market.

Home Depot, in an earnings update following its agreement to sell its HD Supply wholesale business, said it expected its earnings per share to fall 15 per cent to 18 per cent from a year earlier, to a range of $2.30 to $2.36 a share, down from $2.79 per share in its last fiscal year.