Housebuilders rocked by nerves over Help to Buy

FEARS that the Government’s Help to Buy housing scheme was about to be scrapped saw shares in housebuilders crumble yesterday.

Shares plunged as much as 6pc as the market opened after an article in a property magazine suggested the Government had begun a review of the scheme which could result in it being wound down or replaced before April 2021, when it is scheduled to end.

Help to Buy was launched in April 2013 as a way to help first time buyers on to the housing ladder, allowing them to buy homes with a deposit of as little as 5pc.

A spokesman for the UK planning ministry offered reassurance, saying the scheme was regularly reviewed and that ‘to infer that it will be cancelled is incorrect’.

Meanwhile, analysts at Jefferies warned investors not to panic. In a note, they said: ‘We actually believe that tweaking the scheme will help more people.’

The stockbroker said the market had overreacted to the speculation and the Government was unlikely to do anything which could lead to a reduction in housebuilding volumes. Changes made to the scheme could include reducing the price limit on eligible properties.

But it wasn’t enough to allay investors’ fears. Barratt Develop

ments was the hardest hit, its shares dropped 4.7pc, or 29p, to 589p. Meanwhile Persimmon plunged 4pc, or 102p, to 2464p, and Taylor Wimpey tumbled 3.7pc, or 7.3p, to 187.9p. On the FTSE 250, Crest Nichol

son shares slipped 3.7pc, or 20p, to 521p and Bovis Homes was down 2.7pc, or 27p, to 989p. But the shock to the sector did not hold the stock market back. The

FTSE 100 finished up 0.49pc, or 36.94 points, at 7511.71. It was the mining sector which helped drive the market forward on the day.

Anglo American advanced 1.3pc, or 16p, to 1270.5p, while Rio Tinto gained 1.7pc, or 59.5p, to 3546p.

Petrofac shares soared as it announced a £1.5bn contract win in Oman. The firm’s joint venture with Samsung Engineering is set to secure a deal with Duqm Refinery and Petrochemical Industries to work on engineering, construction and training in a 47-month project.

The joint venture will work on a development which, when completed, will have a refining capacity of around 230,000 barrels of oil a day. Petrofac shares surged 8.8pc, or 38.9p, to 483p. Strong first half results pushed

RPS shares higher. Numis raised its target price for the international consultancy company by 10p to 300p as it reported pre-tax profit had surged 88pc to £20.4m in the six months to June 30.

RPS, which provides advice to firms in the energy sector, said a weaker pound and improvement in margins had benefited the business. Shares leapt 4.6pc, or 12.25p, to 278.75p. Stanley Gibbons

Group revealed plans to sell off its interiors business have hit a stumbling block. The firm – which deals in antiques, art and other collectibles – had originally announced the sale of the division to Millicent Holdings for £2.4m back in May.

Yesterday the firm said that despite its best efforts ‘it is now apparent that Millicent is unable to access the funds it had earmarked’ to buy the business.

But Stanley Gibbons said there were other parties interested in acquiring the division. Perhaps investors aren’t quite so confident a sale will materialise though – shares dropped 3.9pc, or 0.38p, to 9.12p.

Clipper Logistics has landed a five-year contract with The Edinburgh Woollen Mill. The firm has won a tender to provide logistics and e-fulfilment services to the retail group. Shares jumped 2.5pc, or 10.5p, to 426.5p.

LondonMetric sold a retail park in Milford Haven for £15.3m. The real estate investment trust made a small profit on the site. Shares edged up 0.4pc, or 0.6p, to 168.1p.