As Tony Pidgley predicted last week, housebuilding shares have “bumped along at the bottom” over the past seven days. And who would doubt the clairvoyant powers of the Berkeley boss?
His company’s 2008 figures are out today and as Building went to press analysts were hoping for a shred of good news from the sector’s best performing stock. But even Pidgley admitted recently that “tails were down” at Berkeley. On Tuesday the share price was hovering at a record low of 652p. They were worth £18 this time last year.
Last Friday brought temporary relief for housebuilders after a report in Building that Barratt’s lenders had agreed to waive some clauses in its banking covenants. Housebuilding stocks rose 6% on the day.
Worryingly, the week was also marked by two profit warnings. Bad news from retail fit-out group Styles & Wood sent its shares from 16p to 9p – down from 216p this time last year. Similar news from Tolent Construction sent shares down from 137.5p to 105p, which meant that the firm lost a quarter of its market cap in a single day.
Bumpy times indeed …