Jim Pickard

Housebuilders tumble in early trading despite yesterday’s “rescue”

September 3, 2008
by Jim Pickard

We couldn’t work out why the share prices of major housebuilders leapt yesterday (some by as much as 10 per cent) on the back of the housing package.

My theory was that some stocks are already priced for collapse - or at least for breaching their banking covenants - and are now so low that any glimmer of good news can shift the price upwards. Others thought that the stamp duty holiday and other measures could genuinely make a difference; helping the housebuilders shift their backlog of unwanted homes to some extent.

Either way, the gains have already been reversed in today’s early trading. My eagle-eyed colleague Alex Barker (supposedly on holiday today) points out that Taylor Wimpey is down 7 per cent, Persimmon down 4 per cent and Barratt Developments down 8 per cent.

September 3rd, 2008 in George Osborne, Gordon Brown, Housing, Labour, Recession, Tax, The business vote, Treasury, UK economy, Uncategorised | Permalink

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