London markets inch lower as housing firms drive drop

London-listed housebuilders led the fallers as the FTSE 100 dipped on Monday (Gareth Fuller/PA)
London-listed housebuilders led the fallers as the FTSE 100 dipped on Monday (Gareth Fuller/PA)

The FTSE 100 looked set to post its first rise for more than a week on Monday but lost all its steam to finish in the red due to weakness in the housing sector and climbing bond yields.

The biggest housing stocks, such as Taylor Wimpey and Persimmon, were a drag as new figures showed asking prices for homes in Britain tumbled in the biggest August fall since 2018 while they were also impacted by weaker than expected trading from rival Crest Nicholson.

London’s top flight moved 0.06%, or 4.61 points, lower to finish at 7,257.82.

Michael Hewson, chief market analyst at CMC Markets UK, said: “At one point the FTSE 100 was posting some solid gains, largely being driven by gains in the energy sector with BP and Shell tracking higher, along with the oil price, however, the dissipation of those oil price gains has served to pull the market off the highs of the day, as yields continue to pop higher.

“The US 10-year yield has pushed to its highest level since 2007, while UK gilt yields are also pushing back towards their highs of the month.”

Elsewhere in Europe, the main indexes lost a large amount of early gains but managed to remain just in positive territory.

Germany’s Dax index was 0.19% higher for the day and the Cac 40 closed up 0.45%.

Meanwhile the pound was down 0.02% to 1.273 US dollars and was 0.07% lower at 1.169 euros at market close in London.

In company news, Crest Nicholson was among the day’s poorest performers after it downgraded its profit outlook for the year as buyers were put off by the tough economic climate.

The housebuilder said that it had faced bad conditions, which got worse in recent weeks, as interest rates continue to rise, and said prices have only remained steady due to low supply.

Crest Nicholson shares were down 17p at 177p at the close of play.

Elsewhere in the FTSE 250, pharmaceutical firm Indivior made gains after it told shareholders that it has agreed a resolution in relation to ongoing antitrust litigation.

The addiction treatment specialist said it has agreed to pay 30 million US dollars (£23.5 million) to end payor claimants, in the case related to its Suboxone drug.

Shares closed 70p higher at 1,829p as a result.

B&M European Value Retail was up for the day after analysts at Liberum said the firm’s stock could rise further, saying there are still “too many positives to ignore”.

Shares in the company moved 5.2p higher to 571.2p on Monday.

The price of oil lost some of its early gains but remained a touch higher as it held on to some momentum from gains in the two previous trading sessions.

A barrel of Brent crude oil fell by 0.58% to 85.29 US dollars at the time markets were closing in London.

The biggest risers in the FTSE 100 were Pershing Square Holdings, up 64p at 5,445.04p, IHG, up 66p at 5,894p, Antofagasta, up 14.5p at 1,390p, BP, up 4.85p at 478.3p, and Glencore, up 3.95p at 420p.

The biggest fallers of the day were Taylor Wimpey, down 4.8p at 107.8p, Persimmon, down 39p at 983p, Ocado Group, down 26.6p at 734.4p, Berkeley Group, down 131p at 3,860p, and Barratt Developments, down 11.9p at 421.7p.