Homebuilders led gains on upbeat outlook from Bellway
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Aug 9 (Reuters) – London’s main equity indexes logged declines for a second week on Friday, but ended higher for the day supported by healthy gains in homebuilder stocks, while positive U.S. jobs data this week allayed fears of recession in the world’s largest economy.
The blue-chip FTSE 100 index (.FTSE), opens new tab was up 0.3% on the day, while the mid-cap FTSE 250 (.FTMC), opens new tab rose 0.6%. However, both indexes ended down on the week, with midcaps down 1.5%.
Thursday’s weekly U.S. jobless claims fell more-than-expected, suggesting that fears of a cooling labour market were overblown.
Global markets had a volatile week as fears of a U.S. recession following U.S. jobs data for July and a surge in the yen after the Bank of Japan raised interest rates on July 31 caused investors to unwind yen carry trades.
In London, homebuilders (.FTNMX402020), opens new tab were among top gainers, rising 1.5%, after Bellway (BWY.L), opens new tab joined rivals in offering an upbeat outlook of the sector following the Bank of England’s rate cut and the new labour government’s proposed planning reforms.
Next week will be a crucial one as investors will closely monitor the consumer price inflation data in the United States and the UK, alongside Britain’s gross domestic product figures for the second quarter.
“With concerns about the quantum of existing carry trades still lingering, next week looks a significant one in terms of economic announcements with readings of US inflation and retail sales,” said Russ Mould, investment director at AJ Bell.
