FTSE treads water despite falling housebuilders

Big drops for the UK’s biggest listed housebuilders were offset on Tuesday as the big oil companies and utilities helped keep the FTSE 100 from a big drop.

Ahead of a potential interest rate hike later this week, new figures from Nationwide shocked the builders on Tuesday.

The building society said that while house prices are still increasing, the number of approved mortgages dropped in June.

It might take some time for this to feed through to prices, but it shows a sign of some weakening as interest rates make it more expensive to buy.

Taylor Wimpey – which is reporting interim results on Wednesday – felt the pain the most, dropping by 6%. Barratt Developments, Berkeley Group and Persimmon all fell by more than 4%, putting them among the worst performers.

Online property portal Rightmove also dropped significantly.

They helped pull the FTSE to a 4.31 point drop, ending at 7,409.11, a drop of less than 0.1%.

But the index was saved from worse by the performance of BP, Shell, National Grid and Severn Trent among others.

BP was lifted by its morning results, which saw the business reporting the highest quarterly profit it has seen for 14 years.

In Germany, the Dax index dropped 0.2%, while France’s Cac 40 fell by 0.4%.

“European markets have slipped back as the rising uncertainty created by US House Speaker Nancy Pelosi’s trip to Taiwan has served to keep markets on edge,” said CMC Markets analyst Michael Hewson.

“The increase in noise over this trip by China has upped the ante and raised the prospect of a serious miscalculation which neither side really wants.

“This appears to be a classic case of sabre rattling, with neither side wanting to be seen to back down.

“The FTSE 100 has held up better than its European counterparts propped up by a strong performance from BP, and the more defensive parts of the index.”

In New York, the S&P 500 rose around 0.1%, while the Dow Jones dropped by 0.4%.

Sterling was flat against the dollar, with one pound buying 1.2218 dollars, but rose 0.04% to 1.1985 euros.

In company news, Greggs the baker saw its shares jump 2.6% on the day after it reported a jump in sales.

The business said that customers are turning to its cheaper meal options as the cost-of-living crisis squeezes workers’ wallets.

Sales rose by more than 27% in the six months to the start of July, but the business was unable to turn this into a rise in profit as a VAT increase, the reintroduction of business rates and increased costs took a chunk out of its margin.

The biggest risers in the FTSE 100 were Haleon, up 12.1p at 309.7p, BP, up 11.35p at 403.7p, National Grid, up 29p at 1,148p, Standard Chartered, up 13p at 581.2p, and Pearson, up 19.4p at 872p.

The biggest fallers of the day were Taylor Wimpey, down 7.95p at 120.05p, Barratt, down 28.1p at 477.5p, Berkeley, down 213p at 4,085p, Persimmon, down 79p at 1,825p, and Kingfisher, down 9.6p at 249.4p.