Market Report: Bank of England governor Mark Carney's remarks hit housebuilding stocks
Your support helps us to tell the story
From reproductive rights to climate change to Big Tech, The Independent is on the ground when the story is developing. Whether it's investigating the financials of Elon Musk's pro-Trump PAC or producing our latest documentary, 'The A Word', which shines a light on the American women fighting for reproductive rights, we know how important it is to parse out the facts from the messaging.
At such a critical moment in US history, we need reporters on the ground. Your donation allows us to keep sending journalists to speak to both sides of the story.
The Independent is trusted by Americans across the entire political spectrum. And unlike many other quality news outlets, we choose not to lock Americans out of our reporting and analysis with paywalls. We believe quality journalism should be available to everyone, paid for by those who can afford it.
Your support makes all the difference.Remarks by Bank of England governor Mark Carney poured cold water on recently buoyant housebuilding stocks as investors panicked.
Mr Carney shocked the City with comments that the Funding for Lending scheme will no longer be used to support borrowing for house buying and instead will be redirected at small businesses. Housebuilders’ share prices collapsed on the news with Persimmon down 6.1 per cent (76p to 1,170p) at the bottom of the benchmark index and builders’ merchant Travis Perkins 49p weaker at 1,783p. On the mid-tier table, eight of the bottom 12 stocks were builders with Bovis Homes 45.5p weaker at 777p and Taylor Wimpey down 7.1p to 107.4p.
But analysts decided the reaction was overblown. Liberum Capital’s Charlie Campbell said: “The Bank of England’s actions towards FLS don’t imply any sudden hostility towards Help to Buy. We therefore see the weakness in shares as a buying opportunity. “
Despite the housebuilders’ drag on the market, the FTSE clung on to gains, on slim volumes as the US was closed for Thanksgiving. The FTSE 100 added 5 points to 6,654.47.
Top of the table was Rio Tinto up 122p to 3,261p on news of that it will spend less than expected on its planned increase in iron ore production in Australia.
Travel agent Thomas Cook flew up 22.5p to 175.7p after reporting a return to operating profit for the first time in three years.
There was speculation that German engineering company M&W Group may look again at oil engineering specialist Kentz having walked away in the summer. FTSE 250-listed Kentz spurted 14.5p to 594.5p.
Goldman Sachs analysts set a 610p target price on Royal Mail shares, despite the US bank having advised the UK government on setting a much lower offer price of 330p. Royal Mail dipped 10p to 555p.
Small-cap computer group Phoenix IT reported a half-year loss and flopped 7p to 137.5p.
AIM-listed machine-gun maker Manroy fired off a disappointing update with regard to bid talks and tumbled 10p to 73p.
There was a better second half of the year for toy group Character Group and it added 7p to 169p.
Join our commenting forum
Join thought-provoking conversations, follow other Independent readers and see their replies
Comments