Market Report: House builders benefit from the election campaign

Election fever is driving attention towards the housing sector, and cross-party support for increased supply and help for first-time buyers is likely to benefit the likes of MJ Gleeson, which builds housing estates on Brownfield and other sites. Analysts at N1Singer reckon it is a “highly supportive environment for Gleeson, given its focus on affordable housing in disadvantaged areas, and see nothing to fear for responsible businesses such as Sigma Capital and Grainger, whose business models are predicated on the fair treatment of tenants”.

The support helped Gleeson hold firm at 391p in a falling market, while Sigma, which is involved in regeneration of residential and other property, was also unchanged at 63p.

The FTSE 100 meanwhile was a sea of red, reversing Monday’s gains to close down 73.45 at 7,030.53 as weaker-than-expected UK economic data unsettled a market already jittery over the ongoing Greek debacle and the approaching election. “The last time a general election came as a genuine surprise was in 1992, with the FTSE 100 jumping almost 6 per cent on the day of that result,” said Peter Cameron of Ecclesiastical Investment Management. “I would expect increasing market volatility in the days ahead as we enter the final straight of this campaign.”

First-quarter earnings season kicked off in the oil sector with better-than-expected results from giant BP, off 0.8p at 476.1p, even though its refining business more than made up for the oil price slide. In the broader sector, Lamprell rose 3p to 133.75p after Abu Dhabi’s National Drilling Company awarded it a contract to build a high-spec drilling rig. The group should benefit from ageing rigs around the world, with about 30 per cent over 35 by 2017, according to Investec analysts.

UK Oil & Gas, David Lenigas’ exploration firm which recently made claims there were 100 billion barrels of oil under the South-east, came under pressure after saying one of its drilling licences at the Horse Hill site near Gatwick is set to expire in September. It fell 8 per cent to 2.85p even though it said it has applied for an extension.