Housebuilders keep gaining on optimistic outlook
|Pre-BoE nerves do not appear to be afflicting sterling too much, while an update from Crest Nicholson has lifted the housebuilding sector once again.
UK markets are calm ahead of the BoE meeting, and while expectations for any change are quite low, investors are on notice for some tweaks to the statement. Having been caught napping by the Fed there is a determination not to repeat this, but the circumstances appear rather different this time. For the UK, the end of the furlough scheme threatens to spark a wave of unemployment that will set the UK economic recovery back, and it must be this, rather than recent inflation strength, that will bother UK policymakers. Given such an overhang, it is likely that any tweaks to today’s statement will be cosmetic at best, designed to give the BoE as much leeway as possible. Still, this cautious outlook hasn’t affected sterling much, as GBPUSD renews its march back to $1.40 and the pound makes some headway against the euro too.
Crest Nicholson became the latest housebuilder to report an improvement in profits today, bolstering the share price by around 3% and building on the 45% gain for the year so far. The UK recovery is certainly in full swing where homes are concerned, Britons having escaped from lockdown by renewing their love affair with property. Activity in the market is certainly on the rise, with ‘business as usual’ returning remarkably quickly.
Ahead of the open, we expect the Dow to start at 34,064, up 190 points from Wednesday’s close.
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