Even bullish brokers can’t stop the builders sinking
HOUSING market gloom encroached on builder Crest
Nicholson yesterday, as its shares reversed from an early climb.
While rivals such as Berkeley, McCarthy & Stone and Barratt have been showing cracks in their facades recently – Berkeley and Barratt were both among the FTSE100’s top-ten fallers yesterday – Crest managed to cement a rise of 4.3pc in early trading after a broker gave it the thumbs up.
In their first coverage of the company, analysts at Liberum said negativity surrounding Crest had been ‘overdone’. They added that ‘the housing shortage is most acute in Crest’s regions’ – which range from the Midlands to the south coast.
But the FTSE 250 business, backed by fund manager Neil Woodford, crumbled over the course of the day to end down 1.3pc, or 5.2p, at 393.8p.
The FTSE 100 closed down 0.93pc, or 70.96 points, at 7556.44, as the pound ran ahead after strong hints of an interest rate rise in August from the Bank of England. Policymakers’ optimism over the UK economy caused sterling to climb to $1.32.
Pharmaceutical company Shire, soon to be acquired by Japan’s Takeda, helped to bolster the blue-chip index as the US drugs regulator authorised the use of its new children’s medication.
Its Cinryze drug can be used on children as young as six with hereditary angioedema, a rare disease which causes potentially fatal swelling in the body. Its approval across the pond prompted Shire’s shares to climb 1.9pc, or 78p, to 4088p.
Recruitment firm Page was boosted as analysts at Citi lifted its target price to 650p, saying its valuation was surprisingly low considering that past investment was beginning to pay off. It ended the day up 2.6pc, or 14p, at 560p.
Over-50s specialist Saga did not quite manage to get the wind in its sales after it said trading was so far in line with expectations for the year.
The home and motor insurance markets were competitive, Saga said, and tour bookings were flat year-on-year, though there were signs that this was picking up. Shares were shaved down by 0.6pc, or 0.7p, to 126.6p.
The AA stalled, shedding 4.2pc, or 5.85p, to 133.6p after investors including Deutsche Bank and Liontrust reduced their stakes.
London’s junior market had a marginally better day, as a coincidental flurry of mining discoveries helped to pump up shares.
Greatland Gold struck lucky as it discovered gold nuggets at its Black Hills site in Australia, sending shares rocketing by 77.5pc, or 0.55p, to 1.26p.
Meanwhile Echo Energy hit a new oil column in its Argentina well, which fuelled a 25.9pc rise in its shares, or 3.2p, to 15.55p. Mineral miner Dalradian
Resources, which is dual-listed across London and Toronto, bagged a £347.7m sale to private equity firm Orion Mine Finance.
News of the deal caused the company’s shares to fly 53.5pc, or 28.5p, to 81.75p.
Rounding up the AIM successes, Koovs – also known as the ‘Asos of India’ – had another stellar day as it teamed with Bollywood star Taapsee Pannu.
The clothing brand rose by 10.6pc, or 2.25p, to 23.5p, and has now built up its share price by 69.4pc in the year to date.
Yet there were casualties. LPA, which manufactures electromechanical systems and LED lighting for transport systems, including the London Underground, crashed 27.1pc, or 43.5p, to 117p.
In its half-year report yesterday it boasted of ‘sustained’ record profits. However chairman Michael Rusch warned that the ‘medium term’ may be more challenging.