The FTSE 100 jumped and the mid-cap index hit a record high this morning as house price data revealed the extent of the pandemic property boom.
The main index made a strong start to September, climbing 0.96%, or 49 points, to 7,168 as the latest house price data from Nationwide revealed the average home is now worth £248,857 – an 11% year-on-year increase, and a 13% rise since the start of the Covid-19 pandemic.
However, housebuilders and real estate-related stocks were little moved as experts expect a cooling in the housing market following the end of the stamp duty holiday.
Instead, JD Sports (JD) led the blue chips higher, up 2.2%, or 23p, to trade at £10.32 as Berenberg raised its target price to £12.00 for the sportswear retailer despite supply chain pressures.
International Consolidated Airlines (IAG) gained 2.2% to trade at 162p, as the British Airways owner clawed back some of yesterday’s losses on the back of an EU call to reintroduce travel restrictions for US tourists.
Russ Mould, analyst at AJ Bell, said: ‘Summer holidays are over, children are returning to school, and we’re now only weeks away from the start of autumn. This shift in mindset also applies to investors as they sharpen their focus on market opportunities in the final section of the year.’
He said in the UK, mining was the only sector to struggle as metal prices ‘took a hit’ and ‘investors instead showed more interest in the oil and gas sector where commodity prices were stronger’.
The FTSE 250 may not have climbed as high as its blue chip counterpart but it still hit a new high in early trading, adding 0.7% to hit 24,228 before pulling back slightly to 24,197 by 9am.
Building products manufacturer Tyman (TYMN) was the biggest winner, advancing 5.9%, or 24p, to 439p after Berenberg upgraded the stock to ‘buy’ from ‘hold’ after the shares pulled back after a strong run.
Travel stocks were also climbing on the mid-cap index, with Wizz Air (WIZZ) up 2.4% at £49.79, cruise operator Carnival (CCL) adding 2.2% to hit £16.05, and budget airline Easyjet (EZJ) up 2.1% at 812p.
In investment trust news, LXI Reit (LXI) slipped 0.67% to 148p after completing a sale and leaseback acquisition of a portfolio of 23 nursery schools for £34m, reflecting a 5.5% net initial yield against the portfolio’s value of 4.7%. Each nursery has a new, unbroken 30-year lease attached, with annual rental increase in line with the retail price index until 2030.
BH Macro (BHMG) ticked 0.58% lower to £35.78 after half year results reported a net asset value increase of 1.2% and a nearly 4% fall in the share price total return driven by management’s proposed changes that saw it combine BH Macro and BH Global funds.
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