Redrow, other homebuilders higher on broker upgrade

| December 16, 2009 | 0 Comments
Redrow, other homebuilders higher on broker upgrade

European equities markets saw gains on Wednesday.

In London, the FTSE 100 added 0.65 percent to 5,320.26 while the FTSE 250 gained 1.27 percent to 9,141.35, helped higher by a decline in UK jobless claims.

Homebuilders were mostly higher after Citigroup raised its recommendation on Redrow (LSE: RDW), Taylor Wimpey (LSE: TW) and Barratt Developments (LSE: BDEV) to “buy”, saying that share prices don’t adequately represent the outlook for the sector.

Redrow led gains in the sector as it added 6.94 percent, while Barratt was up 6.03 percent and Taylor Wimpey gained 4.92 percent.

The related real estate sector was mixed as Liberty International (LSE: LII) was 4.35 percent higher to lead gains in the sector, but residential property developer Grainger (LSE: GRI) dropped 5.22 percent for the biggest decline in the sector.

Miners were higher, except for gold miner Petropavlovsk (LSE: POG), which dropped 4.69 percent, while in the energy sector, oil and gas explorer Heritage Oil (LSE: HOIL) was the only decliner as it fell 3.31 percent on the session.

The best performance on the 100 came from buyouts and restructuring specialists Resolution (LSE: RSL), which added 4.96 percent, while the biggest loser on the 100 was United Utilities Group (LSE: UU), which fell 2.24 percent as it traded ex-dividend.

Over on the 250, electronics group Laird (LSE: LRD) gained 12.64 percent for the best performance of the day in London, while brewer Marston’s (LSE: MARS) was the worst performer in London as it dropped 6.27 percent.

The FTSE Eurofirst 300 was up 1.13 percent to 1,030 while the CAC-40 and the IBEX each added 1.09 percent, to 3,875.82 and 11,863.2 respectively, and the Dax gained 1.58 percent to 5,903.43.

Markets in the Asia-Pacific region were mixed, with most down although the main indices in Tokyo saw gains, as did the Sensex and the Straits Times Index.

The Nikkei 225 added 0.93 percent to 10,177.41 in Tokyo, while the Topix index was up 1.54 percent to 898.29 but the Mothers market fell 1.07 percent to 406.74.

Tokyo’s banks gained on reports, as yet unsubstantiated, that the Basel Committee on Banking Supervision will give banks around he world a grace period before enforcing stricter regulations meant to avert another credit crisis like the one that triggered the recession.

The committee is expected to publish a draft of its new rules by the end of January.

The rumors sent Mitsubishi UFJ (TYO: 8306) up 4.9 percent, while Sumitomo Mitsui Financial Group (TYO: 8316) added 14.3 percent and Mizuho Financial Group (TYO: 8411) gained 15.2 percent.

The real estate sector was also helped by the possibility of a grace period on bank regulations.

Besides the Nikkei and Topix, India’s Sensex was up 0.21 percent to 16,912.77 while the Straits Timex Index added 0.54 percent to 2,813.93.

The Kospi was 0.1 percent lower to 1,664.24 in South Korea, while in Australia the Sydney Ordinaries and the S&P/ASX200 each fell 0.25 percent, to 4,676.1 and 4,661.9 respectively.

Meanwhile, the Shanghai Composite was 0.59 percent lower to 3,255.21 while the Taiex fell 0.72 percent to 7,751.6 and the Hang Seng dropped 0.93 percent to 21,611.74.

At just before 1 p.m. in New York, the Dow Jones Industrial Average was 0.21 percent higher to 10,474.22 while the Nasdaq Composite had added 0.63 percent to 2,214.9 and the S&P 500 was up 0.52 percndet to 1,113.73.

The gains came on the news that consumer prices held steady in November, with the exception of food and energy, while the Commerce Department reported that home and apartment construction in the US was up 8.9 percent in November.

Prices for oil and metals were higher in midday trade in New York.

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