Housebuilding stock investors spooked in UK

UK housebuilders came under pressure today after downbeat comments from Bovis Homes spooked investors.

The company’s reports of a “recent slowdown” in sales activity after interest rate hikes hit Persimmon and Barratt Developments, which were the London market’s highest fallers.

The poor session for the sector came despite the FTSE 100 Index making broad progress to stand 18 points ahead at 6708.1 points by mid-morning.

Among housebuilders, Persimmon was off nearly 3%, or 36p, at 1178p, while Barratt fell 18.5p to 996.5p. In the FTSE 250 Index, Bovis lost 75p – or 8% – to 845.5p and Redrow fell 28p to 513p.

Sugar refiner Tate & Lyle was the highest riser, ahead 20p at 574p, or more than 3%, after an upgrade from Credit Suisse.

Meanwhile British Airways followed behind – up 11.75p to 445.5p – after more positive broker comment, as Panmure Gordon said the carrier was well set to shrug off higher fuels and competition.

Prospects of higher metal prices also lifted heavily weighted mining stocks, with Kazakhmys up 22p at 1327p, BHP Billiton up 17p at 1533p, and Antofagasta cheering 9p to 672.5p.

But among the Footsie fallers, Argos owner Home Retail Group suffered as the negative sentiment over the retail sector persisted. The stock was down 6.5p at 453.25p.

Fashion chain Next was downgraded by HSBC, which said “the summer season is already a washout”, although the stock recovered most of its earlier falls to stand 7p down at 2010p.

B&Q owner Kingfisher was also off 1.25p at 221.5p, although Marks & Spencer bounced back from losses seen in early trading to sit 3p higher at 631p ahead of a trading update tomorrow.

In the FTSE 250, Branston pickle-to-Oxo stock cube group Premier Foods fell nearly 4%, or 11p, to 282.5p after revealing half year like-for-like sales would be lower.