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Wednesday 22nd of October 2008
October 20, 2008

Persimmon leads homebuilders lower on broker downgrades

by Elaine Frei
Persimmon leads homebuilders lower on broker downgrades

European equities markets were higher Monday on higher oil prices, positive earnings reports and on another bailout in the banking sector.

In London, the FTSE 100 added 5.41 percent to 4,282.67 while the FTSE 250 gained 1.4 percent to 6,399.45.

Homebuilders were lower on the 250 on broker downgrades to “sell” within the sector as Bovis Homes (LSE: BVS) was down 10.64 percent, Taylor Wimpey (LSE: TW) fell 12.5 percent, Barratt Developments (LSE: BDEV) was 12.65 lower and Persimmon (LSE: PSN) dropped 15.74 percent.

The FTSE Eurofirst 300 added 3.75 percent to 928.29 as the Dax was up 1.12 percent, the IBEX was 2.99 percent higher to 9,944.3 and the CAC-40 gained 3.56 percent to 3,448.51.

Most equities markets in the Asia-Pacific region were also higher after South Korea said it will make $30 billion in US dollars available to banks there and give tax benefits to long-term equities investors while the Reserve Bank of India cut interest rates for the first time in four years, from 9 percent to 8 percent.

India’s Sensex was up 2.48 percent to 10,223.09 on the rate cut.

In Tokyo, the Nikkei 225 added 3.59 percent to 9,005.59 while the Topix index was 3.7 percent higher to 927.37 and the Mothers market gained 4.72 percent to 325.42 in lighter than average trade.

Elsewhere in the region, the Shanghai Composite was up 2.25 percent to 1,974.01 while the Kospi added 2.28 percent on the bank rescue plans by the South Korean government and the Straits Times Index was 3.23 percent higher to 1,939.22.

In Australia the Sydney Ordinaries added 3.9 percent to 4,098.7 and the S&P/ASX200 was up 4.32 percent to 4,142.3 while the Hang Seng gained 5.28 percent to 15,323.01.

In Taiwan, the Taiex dropped 0.58 percent to 4,931.84.

Wall Street closed higher, with the Dow Jones Industrial Average up 4.67 percent to 9,265.43 while the Nasdaq Composite added 3.43 percent to 1,770.03 and the S&P 500 dropped 4.77 percent to 985.4.

Crude oil prices and precious metals prices were higher, while base metals prices fell and grains prices were mixed.

The US dollar was higher versus the euro during the session.

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