UK homebuilders see gains as London home prices rise

| May 31, 2011 | 0 Comments
UK homebuilders see gains as London home prices rise

European equities markets saw gains on Tuesday on optimism that the European Union and the International Monetary Fund will agree to new help for Greece after Germany expressed willingness to compromise on its insistence that Greece reschedule its bonds, with the euro rising as Luxembourg’s Prime Minister said that an agreement should be reached on an aid pacakage for Greece by the end of next month.

The FTSE 100 was up 0.86 percent to 5,989.99 in London, while the FTSE 250 added 0.85 percent to 12,060.79 as homebuilders joined most other sectors in gains, with the homebuilders up on a report that luxury-home prices were up in central London by 1.4 percent in May from April, mostly on purchases by overseas buyers, while an analysts report said that UK home prices generall will begin to go up by the end of the year.

Redrow (LSE: RDW) up 1.8 percent while Bovis Homes (LSE: BVS) added 1.34 percent, Taylor Wimpey (LSE: TW) was 1.15 percent higher and Barratt Developments (LSE: BDEV) gained 0.8 percent.

The chemicals sector led gains on the 100, with Johnson Matthey (LSE: JMAT) up 4.64 percent, while over on the 250 AZ Electronic Materials SA (LSE: AZEM) was up 8.12 percent, but Lloyds Banking Group was the worst decliner on the 100, dropping 1.44 percent as other London banks saw gains.

Both the best and worst performers on the 250 came from the travel and leisure sector, where internet gambler Betfair Group (LSE: BET) added 8.19 percent, but car rental agent Avis Europe (LSE: AVE) dropped 5.54 percent.

The FTSE Eurofirst 300 was up 0.75 percent to 1,141.24 while the CAC-40 added 1.63 percent to 4,006.94 with just three decliners, the Dax had no decliners and was 1.86 percent higher to 7,293.69 and the IBEX gained 2.13 percent to 10,476.

Markets in the Asia-Pacific region were higher, helped by hopes that a new bailout will soon be agreed to for Greece, while companies involved in making technology related to solar and wind power were up in the region after a coalition led by Germany’s chancellor agreed to a plan to close all nuclear plants in Germany by 2022 in favor of renewable energy sources.

The Nikkei 225 was up 1.99 percent to 9,693.73 in Tokyo, while the Topix indexadded 1.8 percent to 838.48 and the Mothers market gained 0.55 percent to 463.27 after the yen weakened and on a government survey of Japanese manufacturers said that they plan to to up production to near normal levels, with production expected to have been up 8 percent in May and to grow another 7.7 percent in June.

Exporters, including carmakers and the electronics sector were up, as were construction equipment and robot manufacturers, but Tokyo Electric Power (TYO: 9501) dropped 2.8 percent after Standard & Poor’s cut its credit rating to junk status on the possibilitiy that banks could restructure at least some of its debt.

Elsewhere in the region, the Straits Times Index was up 0.62 percent to 3,159.93 in Singapore while Australia’s markets advanced as the S&P/ASX200 added 0.87 percent to 4,708.3 and the Sydney Ordinaries gained 0.9 percent to 4,788.9, the Shanghai Composite was 1.37 percent higher to 2,743.47, India’s Sensex was up 1.49 percent to 18,503.3, the Taiex added 1.87 percent to 8,988.84 in Taiwan, Hong Kong’s Hang Seng was 2.16 percent higher to 23,684.1 and the Kospi gained 2.32 percent to 2,142.47.

New York equities markets were higher but down from earlier gains in midday trade, hurt by the S&P/Case-Shiller index of home prices that showed house prices in 20 US cities down by 3.6 percent in March from the previous year, while manufacturing activity in the Chicago and Dallas regions were were reported down unexpectedly and US consumer confidence declined.

At shortly before 1 p.m. in New York, the Dow Jones Industrial average was up 0.43 percent to 12,495.4 while the S&P 500 had added 0.34 percent to 1,335.67 and the Nasdaq Composite was 0.51 percent higher to 2,811.11.

Crude oil prices were higher as the US dollar weakened, with West Texas Intermedate crude up $1.40 to $101.99 per barrel at midday in New York, while the most recent report had Brent crude up $1.66 to $116.34 per barrel on the ICE Futures Europe exchange in London.

Metals prices were mixed in New York trade, with silver up but gold and copper both down slightly.

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