MARKET REPORT: Homebuilders hit by rising interest rates

home builders took a beating as fresh fears over rising interest rates cast a gloomy outlook on the sector.

The respite brought by the Bank of England’s dramatic intervention in the gold markets on Wednesday ended abruptly as attention turned to the housing market outlook.

Barratt Developments led the decline, down 6.3 per cent, or 21.6 pence, to 323.74 pence, followed by Taylor Wimpey, which fell 6.5 per cent, or 5.88 pence, to 85 .08 pence, while Persimmon fell 5.7 percent, or 75 pence, to 1,175 pence.

Property Damage: Barratt Developments led the decline in homebuilding, down 6.3%, followed by Taylor Wimpey, which fell 6.5%, while Persimmon fell 5.7%.

Property Damage: Barratt Developments led the decline in homebuilding, down 6.3%, followed by Taylor Wimpey, which fell 6.5%, while Persimmon fell 5.7%.

Meanwhile, Rightmove, the estate agent portal, fell 7.1 percent, or 35.7 pence, to 466.6 pence.

The sell-off was even more brutal at Barratt and Rightmove, as their shares were traded ex-dividend, meaning only those who bought the shares before this point can receive the next dividend.

The prospect of further interest rate hikes has fueled fears of a housing market downturn as mortgage costs rise.

This could affect demand for new homes and result in lower prices, hurting developers’ profits.

“There is still a risk that if mortgage rates become increasingly unaffordable, then there could be a severe correction in the housing market, causing a new maelstrom of trouble for struggling homeowners and a worsening outlook for home builders. homes,” said Susannah Streeter, an analyst at Hargreaves Lansdown.

Anxiety returned to markets as the FTSE 100 sank 1.77 percent, or 123.80 points, to 6,881.59 and the FTSE 250 fell 3.06 percent, or 530.57 points, to 16,790. 40.

The losses were echoed in stock markets around the world with Germany’s Dax index falling 1.71 percent and France’s Cac 1.53 percent, while on Wall Street the Dow Jones fell 1 .54 percent.

Stock Watch – XL Medium

A stark earnings warning spooked investors at XL Media, the digital marketing firm that makes most of its money from US sports assets.

Earnings for the year are expected to be flat compared to the previous 12 months, before returning to growth in 2023.

This is largely because he altered the content of his personal finance business to comply with Google’s guidelines.

Revenue from this section is expected to be around £1.37m, which means a loss of up to £1.8m. XL fell 29 percent, or 10 pence, to 24.5 pence.

Back in London, Synthomer suffered its worst day on the stock market.

The polymer maker, which sells the raw materials used to make medical gloves, said its profit for the year is expected to be 10-15 percent below earlier expectations amid a global slowdown in orders. as businesses use supplies stored during the pandemic.

There are also concerns about its balance sheet and whether a rights issue will be needed to raise more funds. It fell 34.8 percent, or 47.95 pence, to 90.05 pence.

Capricorn Energy has abandoned a merger with FTSE 250 firm Tullow Oil in favor of forming a new group with Israel’s NewMed.

Capricorn shareholders, who will pocket a special dividend of £1.72 per share, will own 10.3 per cent of the company with the remainder controlled by NewMed investors.

The news will deal a blow to Tullow Oil, which just two weeks ago said it remains “fully committed” to the merger to “create a leading energy company in Africa.” Capricorn rose 2.5 percent, or 6 pence, to 245.6 pence, while Tullow fell 6.6 percent, or 2.92 pence, to 41.52 pence.

IHG assured the market that a cyber attack on September 6 failed to access the personal data of guests. The owner of Holiday Inn and Crowne Plaza said its reservation websites and mobile app were back up and running the next day. It sank 2.5 percent, or 1.27 pence, to 48.99 pence.

Meanwhile, Yamin ‘Mo’ Khan, the head of clinical trials specialist Open Orphan, has snapped up nearly £50,000 worth of shares. He was up 14.3 percent, or 1.25 pence, at 10 pence.

Avon Protection secured its first order, valued at £38.6 million, from the US Army under its next generation helmet contract. The maker of helmets and gas masks said deliveries should start next year. It rose 6 percent, or 61 pence, to 1,081 pence.

Two Polymetal directors have resigned. Riccardo Orcel is leaving the London-listed Russian gold producer just months after joining as chairman, while Giacomo Baizini’s departure comes after four years. It fell 2.5 percent, or 5 pence, to 195 pence.

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