Market Report: Wolseley warms up on bullish sector comments

Wolseley continued its remarkable recent run yesterday, after bullish comments from Credit Suisse predicted an increase in homeowners and businesses "improving, not moving".

The broker gave a boost to the builders' merchants sector, even as it cut its forecast for housebuilders.

More than halving its growth expectations for volumes in the new homes market to 2 per cent for next year, Credit Suisse suggested 2011 should see "an inverse correlation between the levels of new build activity" and the amount of repair, maintenance and improvement (RMI). The reason for this, it said, was that not only was some level of RMI unavoidable, but that many people were unwilling to buy new property and instead improve what they already have.

Noting that RMI accounts for 60 per cent of Wolseley's activity, the broker said it is "relatively well placed to deliver growth despite the uncertain outlook for construction activity next year" and that the plumbing and heating company remains its top pick in the UK, with an "outperform" rating.

Wolseley – whose shareholders approved a plan on Tuesday to move its tax residency to Switzerland – has put on more than 500p per share in just over two months, and following Credit Suisse's comments it advanced again, adding 21p to 1,751p.

Overall, the FTSE 100 finished on 5,748.97, just 8.46 points down, after a quiet session, as traders looked ahead to the announcement of stimulus measures from the US Federal Reserve, which arrived after the close of play.

The main gainer was Lloyds Banking Group, with the market reacting positively to the appointment of Antonio Horta-Osorio, Santander's UK chief, as its CEO. The announcement, which came a day after the bank released its latest trading statement that prompted a price drop in its share, caused the company to add 1.81p to 69.2p.

Admiral was also among the big performers, as the car insurer stated its expectation that it would match profit forecasts for the full year. The company experienced a turnover increase of more than 50 per cent in the third-quarter, which it said was the result of a boost in insured vehicles and premium rates, and it gained 43p to 1,670p.

Elsewhere, BP continued to climb, up 7.65p to 439.3p, following Tuesday's latest results. Goldman Sachs described its valuation as "extremely attractive" and was positive about the future prospects of dividends, saying that it expects them "to be reinstated at eight cents per quarter with the fourth-quarter results (14 cents previously) and grow to 11 cents in two years."

Stranded at the foot of the blue-chip index was Cobham after the aerospace electronics company admitted that it was unsure about its growth for the final months of 2010, which it blamed on delays of the awarding of US defence and security contracts. It wasn't all doom and gloom however, as Investec stated its belief that it was "well placed in the mid-to-longer term", but this could not prevent Cobham shedding 22.3p to 211.5p, and it did no favours to BAE Systems, which slid 10.4p to 343.1p, and QinetiQ, down 5.8p to 106p.

Keeping Cobham company was Antofagasta, which revealed a considerable increase in costs and lost 61p to 1,323p, and Next, which fell 49p to 2,180p. The broker Liberum had already expressed its fears that rising cotton prices may harm the clothing retailer, and Next said yesterday that this meant price rises for consumers would be at the high end of its previous estimate of between 5 and 8 per cent.

by far and away the leading stock on the FTSE 250 was Howden Joinery Group, after the kitchen supplier said it expected to beat pre-tax profits forecasts for the year. Panmure kept it as a "buy", saying that it anticipated "further share price upside", and Howden duly delivered, soaring 10.5p up to 90p.

PartyGaming was stuck at the bottom of the mid-tier index for the second day in a row, as Barclays Capital became the latest broker to state its worries over the effects of regulations on its prospective merger with bwin. In its note, Barclays warned of "structurally lower earnings for existing operators", and it drove down PartyGaming 17.9p to 221.1p.

Petropavlovsk was another straggler after reducing its gold production forecast for the year for the second time since August, and it shed 35.5p to 903.5p.

on the Aim, Patagonia Gold released what it described as "exceptional drilling results" from its search for gold and silver in the province of Santa Cruz in Argentina, and the report meant it finished the day 5.25p better off on 26.5p.

There were vague rumours around Caledon Resources, with gossip on a potential bid of £1.10 a share. The miner had said back in September that it was in discussions regarding an indicative approach, but despite details being scarce over further developments, it added 8.75p to 80.75p.

Speculation around Gulf Keystone, however, took a hit after it released a statement yesterday afternoon confirming that there had been no approaches for the company. The company lost 2.75p, to end on 188.25p.

Suggested Topics
Start your day with The Independent, sign up for daily news emails
Life and Style
A monstrous idea? Body transplants might no longer be science fiction
Science An Italian neurosurgeon believes so - and it's not quite as implausible as it sounds, says Steve Connor
Demba Ba (right) celebrates after Besiktas win on penalties
footballThere was no happy return to the Ataturk Stadium, where the Reds famously won Champions League
Arts and Entertainment
Natural beauty: Aidan Turner stars in the new series of Poldark
arts + ents
Mia Freedman, editorial director of the Mamamia website, reads out a tweet she was sent.
arts + ents
Arts and Entertainment
The write stuff: masters of story-telling James Joyce, left, and Thomas Hardy
arts + ents...begging to differ, John Walsh can't even begin to number the ways
Jose Mourinho on Sky Sports
footballEXCLUSIVE COLUMN Paul Scholes: It was not a leg-breaking tackle, as the Chelsea manager had claimed
ebooksA special investigation by Andy McSmith
Latest stories from i100
Have you tried new the Independent Digital Edition apps?
Independent Dating

By clicking 'Search' you
are agreeing to our
Terms of Use.

iJobs Job Widget
iJobs Money & Business

Recruitment Genius: Telesales / Marketing Executive - B2B - OTE £25,000

£17000 - £25000 per annum: Recruitment Genius: An opportunity to join this new...

SThree: Trainee Recruitment Consultant

£18000 - £21000 per annum + OTE £45,000: SThree: SThree Group have been well e...

SThree: Trainee Recruitment Consultant

£20000 - £25000 per annum + OTE £45,000: SThree: SThree Group have been well e...

Recruitment Genius: Business Control Manager

£36000 - £44000 per annum: Recruitment Genius: Encouraging more businesses to ...

Day In a Page

HIV pill: Scientists hail discovery of 'game-changer' that cuts the risk of infection among gay men by 86%

Scientists hail daily pill that protects against HIV infection

Breakthrough in battle against global scourge – but will the NHS pay for it?
How we must adjust our lifestyles to nature: Welcome to the 'Anthropocene', the human epoch

Time to play God

Welcome to the 'Anthropocene', the human epoch where we may need to redefine nature itself
MacGyver returns, but with a difference: Handyman hero of classic 1980s TV series to be recast as a woman

MacGyver returns, but with a difference

Handyman hero of classic 1980s TV series to be recast as a woman
Tunnel renaissance: Why cities are hiding roads down in the ground

Tunnel renaissance

Why cities are hiding roads underground
'Backstreet Boys - Show 'Em What You're Made Of': An affectionate look at five middle-aged men

Boys to men

The Backstreet Boys might be middle-aged, married and have dodgy knees, but a heartfelt documentary reveals they’re not going gently into pop’s good night
Crufts 2015: Should foreign dogs be allowed to compete?

Crufts 2015

Should foreign dogs be allowed to compete?
10 best projectors

How to make your home cinema more cinematic: 10 best projectors

Want to recreate the big-screen experience in your sitting room? IndyBest sizes up gadgets to form your film-watching
Manchester City 1 Barcelona 2 player ratings: Luis Suarez? Lionel Messi? Joe Hart? Who was the star man?

Manchester City vs Barcelona player ratings

Luis Suarez? Lionel Messi? Joe Hart? Who was the star man at the Etihad?
Arsenal vs Monaco: Monaco - the making of Gunners' manager Arsene Wenger

Monaco: the making of Wenger

Jack Pitt-Brooke speaks to former players and learns the Frenchman’s man-management has always been one of his best skills
Cricket World Cup 2015: Chris Gayle - the West Indies' enigma lives up to his reputation

Chris Gayle: The West Indies' enigma

Some said the game's eternal rebel was washed up. As ever, he proved he writes the scripts by producing a blistering World Cup innings
In Ukraine a dark world of hybrid warfare and murky loyalties prevails

In Ukraine a dark world of hybrid warfare

This war in the shadows has been going on since the fall of Mr Yanukovych
'Birdman' and 'Bullets Over Broadway': Homage or plagiarism?

Homage or plagiarism?

'Birdman' shares much DNA with Woody Allen's 'Bullets Over Broadway'
Broadchurch ends as damp squib not even David Tennant can revive

A damp squib not even David Tennant can revive

Broadchurch, Series 2 finale, review
A Koi carp breeding pond, wall-mounted iPads and a bathroom with a 'wellness' shower: inside the mansion of Germany's 'Bishop of Bling'

Inside the mansion of Germany's 'Bishop of Bling'

A Koi carp breeding pond, wall-mounted iPads and a bathroom with a 'wellness' shower