MARKET REPORT: Houseuilders boosted by buoyant home sales

Britain’s housebuilders got a boost after home purchases in the UK bounced back following the end of the Government’s stamp duty holiday.

Data from HM Revenue & Customs showed that there were 96,290 house sales in November, 24.3 per cent higher than in October when the tax break closed. However, that was still 16.4 per cent lower than November last year.

Anthony Codling, chief executive of property data site Twindig, was ‘surprised’, noting the figure was only 3.4 per cent lower than the pre-pandemic average of 99,642.

Sales boom: Data from HM Revenue & Customs showed that there were 96,290 house sales in November, 24.3 per cent higher than in October when the tax break closed

‘It seems that at first glance, the UK housing market is in good health, perhaps it is doubled jabbed and boosted?’ Codling said. ‘The bounce-back implies there is more to the underlying level of transactions than the impact of stamp duty holidays.

‘The pandemic is having a significant impact on where and how we choose to live, and where and how we choose to work… and it seems that the race for space is not over just yet.’

Stock Watch – Instem

Instem, a provider of IT software that helps develop new drugs, hit its highest level in over two months following success in China.

In a brief update, it said it had orders for its Provantis software suite from two ‘long-standing customers’ as well as four new clients.

Boss Phil Reason said they demonstrated the strength of its client relationships in China as well as its ‘momentum in securing new business’.

The shares jumped 6.2 per cent, or 50p, to 860p.  

Major housebuilders benefited, with Barratt up 3.1 per cent, or 21.8p, to 724.8p while Taylor Wimpey rose 3.5 per cent, or 5.75p, to 169.75p. Berkeley added 2.6 per cent, or 122p, to 4763p and Persimmon climbed by 2.2 per cent, or 60p, to 2754p.

Mid-cap builders also rose, with Redrow jumping 2.1 per cent, or 14p, to 684.4p, Crest Nicholson ascending 3.4 per cent, or 11.8p, to 356.2p, Bellway gaining 1.9 per cent, or 60p, at 3234p and Vistry Group bouncing 3.3 per cent, or 36.5p, higher to 1146p.

The FTSE 100 jumped 1.38 per cent, or 99.38 points, to 7297.41 while the FTSE 250 added 1.20 per cent, or 270.42 points, to 22820.30.

Markets rebounded strongly from Monday’s rout after Boris Johnson held off on introducing new lockdown restrictions.

Sentiment was also boosted by a £1bn support package unveiled by Chancellor Rishi Sunak to help businesses ride out Omicron.

Receding fears of strict lockdowns lifted retailers, with Primark owner AB Foods up 4.5 per cent, or 85p, to 1997p while Next bounced 1.3 per cent, or 100p, to 7878p.

The support also boosted hospitality, with publican Wetherspoons up 3.1 per cent, or 26.5p, to 871.5p and Wagamama owner Restaurant Group rising 6.3 per cent, or 5.1p to 86p. 

However, the lack of stricter measures appeared to hit some lockdown winners, with grocery delivery giant Ocado slipping 2.7 per cent, or 4.5p, to 1636.5p.

Meanwhile, the potential scuppering of a massive US infrastructure plan worth trillions of dollars following opposition from Democratic Senator Joe Manchin knocked construction equipment hire firm Ashtead, which dropped 0.1 per cent, or 8p, to 5900p.

JD Sports jumped 4 per cent, or 8p, to 207.2p on the back of strong results from Nike in the US which beat expectations amid a rebound in demand for its trainers.

Miner BHP rose 2.3 per cent, or 49.5p, to 2195.5p after winning approval from regulators to merge its corporate structure as part of its move out of the UK to Australia.

Astrazeneca delivered more positive news as its ultomiris drug was accepted for priority review by the US Food and Drug Administration. It is designed to help treat generalised myasthenia gravis, an auto-immune disease that weakens the muscles. Astra rose 1.4 per cent, or 117p, to 6808p.

Rank Group, the owner of Mecca Bingo, rose 3.1 per cent, or 4.4p, to 145.6p after poaching its new chief financial officer from estate agent Foxtons. Richard Harris will replace Simon Hay in May. Foxtons rose 2 per cent, or 0.75p, to 39p.

Meanwhile, FTSE 250 insurer Hiscox said new chief financial officer, Paul Cooper, will join from asset manager M&G. Hiscox was up 1.3 per cent, or 10.6p, to 852.6p while M&G rose 2.4 per cent, or 4.5p, to 192p.