Housebuilders lead the FTSE risers as no-deal Brexit risk fades

 
Sebastian McCarthy
Follow Sebastian
BRITAIN-ECONOMY-HOUSING-CONSTRUCTION
Housebuilders such as Berkeley Group and Persimmon are among the top 10 FTSE risers today (Source: Getty)

Britain's largest housebuilders saw the value of their shares jump this afternoon as the prospect of a no-deal Brexit began to recede.


Property heavyweights such as Berkeley Group, Persimmon and Redrow were among the top 10 FTSE risers today as a frantic 24 hours of political tussling in Westminster fuelled the possibility of a “softer” Brexit or a second referendum.

Blue-chip constituents Berkeley Group and Persimmon have risen seven and six per cent respectively, while FTSE 250 firm Redrow also climbed seven per cent.

Brick-maker Ibstock has also seen its share price jump seven per cent.

Housebuilders have taken several kickings on the London Stock Exchange in recent months, with several major companies blaming lower profits and less activity in the property market on the current political volatility.


Yet last night's developments signalled a creeping return in the City’s confidence, with Theresa May’s three defeats in Parliament sparking fresh speculation over the chances of another referendum and, for some, lessening the likelihood of Britain leaving the EU without a deal.

A dramatic and successful amendment from Dominic Grieve last night means that MPs will be able to vote on what it wants the government to do if the Prime Minister fails to win a majority for her own deal, with the possibility of parliament deciding to take a no deal outcome off the table.

Connor Campbell, a financial analyst at Spreadex, said: “The pound decided to make the most of yesterday’s Commons humiliation of Theresa May….This is seemingly because the success of Dominic Grieve’s amendment on Tuesday means that the chance of a no-deal Brexit have been reduced.”

He added: “If – or more likely when – Theresa May’s plan gets voted down, the government then has 21 days to make a statement setting out how it proposes to proceed. MPs would then get a say on this Plan B, something that appeared to mean more to the pound than the fact the defeat dealt another potentially government-crushing blow to the PM.”

CMC Markets' chief market analyst, Michael Hewson, added that the prospect of no deal "is further away than ever", leaving either a soft Brexit or even remaining in the EU.

Bloomberg data summarising bookmaker odds puts the chances of a second referendum on Brexit at a new high of roughly 44 per cent.



Related articles