Sector movers: Drop in Gilt yields hits life insurers, gold-diggers higher
(ShareCast News) - Interest rate sensitive REITs led fallers in the market place at the start of the week even as longer-term Gilts' prices advanced at the start of the quarter, pushing their yields sharply lower.
Life insurers were also knocked lower as the yield on the benchmark 10-year Gilt dropped seven basis points to 1.07%, its lowest level since October, alongside similar-sized falls in US Treasury yields.
Household goods and home construction stocks were also down; that followed survey data from Halifax on Friday which revealed that house prices in Britain fell by 0.3% on the month, pushing the annualised rate of price gains from 4.5% in February to 3.5% for March.
In an unrelated move, shares in Next were pacing losses on the Footsie as analysts at Exane BNP Paribas downgraded the stock from 'Neutral' to 'Underperform'.
Going the other way, Randgold Resources was on the frontfoot as Numis singled it and fellow gold-digger Acacia Mining out as its preferred miners in the FTSE and FTSE 250, respectively.
"Whilst we expect gold to face some headwinds during the second quarter due to a combination of weaker seasonal demand and further Fed rate hikes we expect heightened inflation expectations and stronger physical demand in H2 to be supportive for metal prices," the broker said.
Spirax Sarco also found a bid as the same broker upped its recommendation on the shares from 'Hold' to 'Add' as the firm announced its largest M&A transaction ever, picking up German boiler controls outfit Gestra for £160.0m.
Numis said Gestra had long been seen as a strong competitor in Germany, adding that the portfolio was also complimentary and would benefit Spirax's scale and reach.
Top performing sectors so far today
Industrial Metals & Mining 2,432.24 +3.20%
Forestry & Paper 21,154.95 +1.92%
Automobiles & Parts 8,573.69 +0.94%
Industrial Engineering 11,270.18 +0.91%
Mining 15,673.99 +0.72%
Bottom performing sectors so far today
Real Estate Investment Trusts 2,886.04 -1.11%
Real Estate Investment & Services 2,576.62 -1.01%
General Retailers 2,492.70 -0.92%
Life Insurance 8,062.94 -0.90%
Household Goods & Home Construction 17,549.01 -0.49%