THURSDAY MARKET CLOSE: Barratt gives building sector a boost

Barratt Developments said it was expecting full-year profits to leap higher
Barratt Developments said it was expecting full-year profits to leap higher
Share this article
0
Have your say

A bounceback among housebuilders helped the FTSE 100 climb more than 1 per cent after Barratt Developments said it was expecting full-year profits to leap higher, spurring sentiment in the wider sector.

The group rose 4.4 per cent, or 26p, to 620.5p after telling investors that it expects a 45 per cent rise in annual profits to about £565 million.

This helped the sector recover after falling heavily the previous day on the plans announced by the Chancellor in the Budget to restrict tax relief for buy-to-let landlords.

Persimmon rose 78p, or 4 per cent, to 1,954p, and Taylor Wimpey lifted nearly 5 per cent, or 8.7p, at 184.9p.

Sentiment was also helped by a rebound in highly volatile Asian markets, led by gains on China’s main index, which jumped after government measures to stabilise the market. The Shanghai Composite in mainland China surged 6.8 per cent per cent, while Hong Kong’s Hang Seng Index rose 4 per cent a day after suffering its biggest drop since the financial crisis.

A flurry of measures announced on Wednesday included a Chinese government order to state companies and executives to buy shares.

Meanwhile, the Bank of England kept interest rates on hold at 0.5 per cent, where they have remained since March 2009, and the FTSE 100 closed up 90.93 points at 6,581.63.

Topping the blue-chip risers’ board was Primark owner Associated British Foods, as it said sales at the clothing chain rose 13 per cent in the 40 weeks to 20 June, and laid out plans for international expansion in Italy and the US. Shares climbed 5 per cent, or 149p, to 3,080p.

Fashion retailer Next was hit as it went ex-dividend, also suffering on worries over rising staff costs from the Budget pledge to introduce a new living wage. Shares closed down 125p at 7,355p.