Housebuilders shine on FTSE

Housebuilders were the standout stocks in the London market today as reports of a deal between debt-laden Barratt Developments and its banks sent the sector soaring.

Trade publication Building said agreement had been reached to waive a banking covenant clause threatened by valuation write downs later this year.

It helped buoy the under-pressure sector while the FTSE 100 Index struggled for direction elsewhere, dipping two points to 5706.4 by mid-morning.

Barratt jumped nearly 17%, or 13.25p to 91.5p, on the back of the bank deal reports, making it the best performer in the second tier. Charles Church owner Persimmon also topped the Footsie risers’ chart, rising 8% or 29.5p to 394.5p.

Fuel-thirsty stocks such as British Airways and Carnival also made gains as the decision by China to raise energy prices kept the cost of a barrel of oil below recent records. BA rose 3.5p to 229.5p and cruise ship firm Carnival lifted 8p to 1747p.

On the fallers’ side, one of the biggest came from Halifax Bank of Scotland after Panmure Gordon stockbrokers cut its forecasts in the wake of yesterday’s trading update. It is concerned about the outlook for bad debts and the prospect for further credit write-downs.

HBOS shares stood 8.25p lower at 288.5p, putting it back in danger of going below its 275p a share rights issue price.

Royal Bank of Scotland and Barclays eased too, falling 4.25p to 220.5p and 3p to 312.75p respectively.

Retailers were also on the back foot after high street giant John Lewis warned that footfall in its regional shopping centre branches had suffered after consumers cut down on shopping trips amid fears of petrol shortages. Tesco slipped 4.5p to 380p, with Marks & Spencer easing 3p at 339p.

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