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CFD Traders DiaryBullish background offset by more downbeat news from the house market13/5/2008 The Footsie edged up at the open again as the generally bullish background reflected hopes of M&A action in the energy and commodities markets, and there was some value buying again in recovery stocks. Against this though, there was plenty of news from the housing market involving both lenders and borrowers, and it looks as though we are to expect more recession-type given what we are seeing in the sector. Alliance & Leicester said its mortgage lending had fallen sharply in the first four months of 2008, with mortgage balances at 30 April 2008 at £41.2bn, £1.5bn lower than at 31 December 2007. It did add that mortgage arrears were stable and core operating profit excluding Treasury was similar to the same period in 2007, but the market was not impressed, and the shares were down 7% mid-morning. Housebuilder Redrow added to the gloom with a 3% fall after it warned that conditions in the housing market had worsened faster than it expected with reservations down 50% on this time last year due to a lack of mortgage availability. Sector peer Galliford Try was similarly gloomy over the housing market as it lowered guidance for the year to £60m profit, and its shares were down too.
Elsewhere in the consumer market, Enterprise Inns saw an 11% decline in first half profit, in line with expectations, and it too warned of a tough trading environment. Its statement that consumer leisure spend was likely to remain under pressure for some time says it all, and we see further downside in many consumer stocks despite the odd M&A rumours around at the moment.
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