Britain's troubled housebuilders have received a lift after reports that Barratt Developments - which is weighed down with around £1.8bn of debt - was being fully supported by its bankers.
Barratt has struck a deal with its main lenders, according to Building magazine, which could avoid the need for a refinancing. The company is in danger of breaching certain banking covenants if it writes down the value of its landbank - very likely given the state of the property market - but the new agreement would see the banks waive these conditions.
The report has sent Barratt's shares 15.25p higher to 93.5p, a near 20% rise. Persimmon, Taylor Wimpey, Bellway, Bovis and Redrow are also up by around 8%.
Despite this, the market has dipped lower again, with the FTSE 100 index down 12.2 points at 5696.2. Building materials group Wolseley is down 4% after a downgrade from Morgan Stanley, while banks are also under pressure.
HBOS has fallen 9.5p to 287.5p - remember the rights issue price is 275p and the last time the shares were around this level, short sellers were blamed. Today seems to be down to analyst reaction to yesterday's trading statement, with Merrill Lynch, Panmure, Lehman Brothers, Credit Suisse and Citigroup all cutting their price targets. Panmure is the lowest with a 250p forecast.
Citi said: "We believe that HBOS may be struggling to hold on to its better quality customers, leading to an adverse mix shift and exacerbating credit quality concerns."
Barclays has slipped 3.75p to 312p despite reports that Japan's Sumitomo Mitsui Financial was about to invest around £500m as part of the bank's mooted fundraising.
