Among all the day's gloom, some positive news from, of all things, the housing market.
Berkeley is leading the mid-cap risers, up 42p at £12.21 after the London and south east focused housebuilder issued a positive update, saying it would achieve its plan to double profits in five years two years ahead of schedule because trading was better than it had expected. Robin Hardy at Peel Hunt said:
Berkeley's statement suggests that the five-year plan to double pre-tax profit and boost the potential landbank profit by 50% could be delivered in just three years. This could mean that consensus is around 15% too low for 2013 and there should be fewer questions marks over the ability to fund the £13 in special dividends. We remain a buyer with a £14 target price.
But in a hold note, Jon Bell at Shore Capital said:
While we continue to admire the Berkeley business model and its exposure to London and the south east, the company is not immune to the ongoing issues in the wider housing market, particularly continued poor mortgage availability. We believe the shares are up with events (currently trading on a near 70% premium to last reported tangible net asset value of 696p).
