London close: FTSE boosted by housebuilding stocks after Autumn Statement

The FTSE 100 rose on Wednesday with housebuilding stocks leading the way after Chancellor George Osborne announced measures to support the sector in his joint Spending Review and Autumn Statement.

The Chancellor's housing market measures included a £2.3bn funding pledge and reform of the planning laws towards delivering 400,000 affordable housing starts by 2020-21, plus an extension of the Help-to-Buy and shared ownership schemes and a new London Help-to-Buy scheme.

The announcement of higher stamp duty for those buying and selling second homes and buy-to-let properties saw housebuilding stocks come off earlier highs but they remained the top risers including Taylor Wimpey, Persimmon and Barratt Developments.

Osborne also made a giant U-turn on tax credits, alongside an increased state pension and rejigging of the NHS finances.

He confirmed the government will deliver a budget surplus of £10bn by 2019/20 and that £12bn of welfare savings would be delivered in full. The government will borrow £8bn less than forecast to reach this goal.

Osborne predicted the UK economy will grow by 2.4% in 2015-16, 2.5% in 2016-17 before returning to 2.4% in 2017-18 and 2.3% in 2019-20.

Economic data

The Council of Mortgage Lenders said first-time buyer loans in London rose 17% quarter-on-quarter to 12,800 in the third quarter, although that marked a 1% decline on a year-on-year basis. First-time buyers borrowed £3.4bn, 24% more than in the previous quarter and 4% more than in the corresponding period a year ago, while the number of home-movers loans in London rose 32% quarter-on-quarter and 5% year-on-year to 10,800.

Meanwhile, the US saw a raft of economic reports published ahead of Thanksgiving on Thursday.

US durable goods orders rose 3% last month, compared to forecasts for a 1.5% gain and September's upwardly revised 0.8% decrease, according to the Commerce Department.

Separately the Commerce Department revealed US consumer spending rose 0.1% month-on-month in October compared with a 0.1% increase in September and with analysts’ expectations for a 0.3% rise. Personal income rose 0.4% month-on-month in October, in line with expectations and up from an upwardly revised 0.2% increase registered in September.

US jobless claims declined by 12,000 to 260,000 in the week to 21 November, less than analysts' expectations for a 271,000 reading, the according to the Labor Department.

Finally, US consumers were slightly more confident than expected in November, data showed. The final reading of the University of Michigan index monitoring consumer sentiment was revised upward to show a 91.3 reading compared with initial estimates of a 90.0 reading.

Company news

Premier Inn and Costa Coffee owner Whitbread rallied as HSBC initiated coverage of the stock at ‘buy’ with a 5,400p price target.

Anglo American was under pressure after HSBC downgraded the stock to ‘reduce’ from ‘hold’ and slashed the price target to 410p from 770p as it pointed to the miner’s precarious cash flow situation.

Other miners including BHP Billiton, Glencore and Rio Tinto slid as metal prices declined including copper (-0.51%), silver ( -0.30%) and gold (-0.24%).

Shire retreated after Reuters reported that the drug maker was preparing to make a new bid for US biotech firm Baxalta.

Daily Mail and General Trust plunged as the newspaper owner warned that challenging market conditions in the UK print advertising market and those facing Euromoney in the investment banking and commodities sectors are likely to have an adverse impact on the new financial year. The announcement came as the firm reported a 4% drop in adjusted pre-tax profit to £281m for the full-year.

UK Mail slumped as its chief executive for the last decade, Guy Buswell, was given the axe as the company struggles with the transition to its new high-tech parcel sorting hub.

On the upside, Thomas Cook jumped as it reported its first annual profit after tax since 2010 and said it had got off to a positive start to the next year as well.

Ophir Energy rallied on reports it received informal takeover and merger interest from a number of possible suitors amid a drop in oil prices.

BG Group climbed as it began commercial operations from the second train at its Queensland Curtis liquefied natural gas operation.

Market Movers

FTSE 100 (UKX) 6,336.21 0.94%
FTSE 250 (MCX) 17,102.96 0.90%
techMARK (TASX) 3,194.29 1.01%

FTSE 100 - Risers

Taylor Wimpey (TW.) 184.50p 3.59%
St James's Place (STJ) 1,000.00p 3.52%
Compass Group (CPG) 1,117.00p 3.43%
Rolls-Royce Holdings (RR.) 608.00p 3.40%
Barratt Developments (BDEV) 578.50p 3.40%
Pearson (PSON) 834.50p 3.22%
Persimmon (PSN) 1,836.00p 3.03%
WPP (WPP) 1,528.00p 2.90%
Intertek Group (ITRK) 2,740.00p 2.81%
Ashtead Group (AHT) 1,061.00p 2.81%

FTSE 100 - Fallers

Anglo American (AAL) 417.55p -7.62%
Glencore (GLEN) 90.60p -3.60%
BHP Billiton (BLT) 853.50p -2.55%
Rio Tinto (RIO) 2,245.50p -1.25%
Royal Mail (RMG) 481.80p -1.15%
Shire Plc (SHP) 4,597.00p -1.05%
United Utilities Group (UU.) 951.00p -0.73%
Randgold Resources Ltd. (RRS) 4,043.00p -0.66%
Royal Bank of Scotland Group (RBS) 300.40p -0.63%
Royal Dutch Shell 'B' (RDSB) 1,668.00p 0.03%

FTSE 250 - Risers

Thomas Cook Group (TCG) 108.80p 10.63%
NMC Health (NMC) 878.50p 8.46%
Ophir Energy (OPHR) 91.00p 7.57%
TalkTalk Telecom Group (TALK) 239.90p 7.10%
RPC Group (RPC) 713.00p 4.70%
Serco Group (SRP) 107.60p 4.67%
Ocado Group (OCDO) 358.90p 4.57%
Enterprise Inns (ETI) 103.50p 4.44%
Atkins (WS) (ATK) 1,574.00p 4.31%
Diploma (DPLM) 698.50p 4.25%

FTSE 250 - Fallers

OneSavings Bank (OSB) 341.30p -7.28%
Mitchells & Butlers (MAB) 324.00p -5.90%
Aldermore Group (ALD) 244.00p -5.83%
Drax Group (DRX) 230.30p -5.46%
Paragon Group Of Companies (PAG) 376.00p -5.34%
Home Retail Group (HOME) 102.60p -3.66%
BBA Aviation (BBA) 172.40p -3.36%
Poundland Group (PLND) 210.00p -3.23%
Vedanta Resources (VED) 371.00p -3.21%
Pets at Home Group (PETS) 266.40p -3.06%