FTSE 100 watch: Housebuilders help Footsie start October higher

on Oct 2, 2017

The UK benchmark index has started the last quarter of the year on the front foot, finding support in London-listed housebuilders. easyJet (LON:EZJ) meanwhile has cruised to the top of the FTSE 100 leaderboard as rival Monarch Airlines went into administration.

As of 12:08 BST, Britain’s blue-chip index had added 39.80 points to stand 0.54 percent higher at 7,412.56. Housebuilders have been in demand today as UK Prime Minister Theresa May pledged £10 billion of additional funding to help people buy new homes. Barratt Developments (LON:BDEV) is leading the sector higher, having added 3.48 percent to 635.87p.

“That’s a clear positive, and I think (the extension) should actually benefit, more so, the more diversified builders,” Ken Odeluga, market analyst at City Index, told Reuters. “To the extent that we could get something which resembles anything like a soft Brexit, this would forestall much of the feared impact on the sector.”

Shares in easyJet meanwhile have been in demand after Britain’s fifth-biggest carrier Monarch Airlines stopped trading, improving competition prospects for the budget airline.

“Usually what’s bad for one airline – higher fuel costs, terror attacks, air traffic control strikes – is bad for the sector. Shares in the various players have a tendency to track each other with some consistency,” ETX senior market analyst Neil Wilson commented, as quoted by City A.M. “But the failure of Monarch is good news for rivals. […] The third airline failure this year in Europe, after Alitalia and Air Berlin, is a symptom of over-capacity and overly-aggressive pricing.” easyJet’s share price is currently 4.41 percent better off at 1,270.71p.

The FTSE 100 was 0.53 percent up at 7,411.99 points as of 12:18 BST on Monday, 02 October 2017.