Record profits and upbeat forecasts have not been enough to protect construction companies from the stock market slump that has affected share prices around the world.
The companies in the FTSE 100 had millions wiped off their market values last week, with the slide continuing this week. Persimmon Homes fell from 1443p to 1389p a share last week – a fall of 3.7%.
Building materials supplier Wolseley suffered a 5.7% drop, from 1368p to 1290p a share, and Hanson dived 6.4% from 854.5p to 799.5p a share.
Other big names to suffer losses included contractor Kier, whose shares fell 5.1% to 2288p from 2411p. Housebuilder Barratt fell by 9.8% to 1149p from 1274p a share and Atkins’ shares sank 4.7% to 894p a share from 938.5p.
The slump was triggered last week by a sudden fall in China’s stockmarket, triggered by the prospect of increased regulation. This was compounded by economic statistics from the US that suggested that a recession could be possible this year, and a rise in the value of the yen, which has affected confidence in Japan’s exports.
The turbulence has had a negative effect on publicly owned construction companies, which are in the middle of their results season. This means that although businesses across the sector are posting record results, any benefits they are accruing have been offset by the fall in the stock markets.
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