Barratt and Bovis on a promise

Barratt and Bovis on a promise

A handful of Britain's battered builders are undergoing a bit of a rally for a change. Traders said part of the reason was the government's promise yesterday to help the beleagured housing sector.

There were also hopes that Barratt Developments had secured a relaxation of its banking covenants and had renegotiated £400m of new debt facilities. On top of that Building magazine is reporting the company has begun a cost cutting programme, which involves axing 1000 jobs.

So Barratt shares are 4% higher at 42p, while Bovis Homes is 8% better at 315.75p. But Taylor Wimpey, which failed in a £500m fundraising this week, has slipped another 1.25p to 33.75p and Persimmon has dropped 17.5p to 222.5p.

Overall the volatility is continuing. After a mini-revival on both sides of the Atlantic following the US jobless figures, uncertainty has returned along with some poor US service sector numbers. The sector contracted unexpectedly in June, according to the Institute of Supply Management, with the index falling to 48.2 compared to forecasts of 51.

But investors seem uncertain how to interpret this raft of data, so Wall Street is currently around 50 points higher, while the FTSE 100 is down just 3 points at 5423.3.

guardian.co.uk © Guardian Newspapers Limited 2008

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