16:30 Close Footsie was overall broadly unchanged by the Budget today, closing some 50 points lower after falling early in the day, but there was some sector-specific movement. Chancellor George Osborne's Budget speech unveiled a rise in VAT to 20% from 17.5% from January 4, but the move had been widely anticipated. Clothes retailers Marks & Spencer and Next were among the retailers that went well. In compnay news, Costa Coffee owner Whitbread gave the Footsie a small caffeine rush after a trading update. Premier Inn and Costa Coffee were the star performers for the hotel and restaurant chain group as it posted a record 7.6% like for like sales rise. The FTSE 100 was held back by losses among resource stocks, which are hit by a retreat in commodity prices. Oil groups BP and BG fall back, while ENRC leads miners lower. FTSE 100 closed down 52 at 5,247.
16:05 Retailers and housebuilders have reacted postively to today's budget, though shares are lower overall. Chancellor George Osborne has unveiled a rise in VAT to 20% from 17.5% from January 4, but the move had been widely anticipated. Clothes retailers Marks & Spencer and Next are among the retailers going well. The lower than feared rise in Capital Gains Tax was good news for housebuilders, which were also heartened that an immediate rise in CGT means there won't be a rush to sell houses. FTSE 250-listed Barratt and Persimmon are showing good gains. The FTSE 100 is held back by losses among resource stocks, which are hit by a retreat in commodity prices. Oil groups BP and BG fall back, while ENRC leads miners lower. FTSE 100 down 54 at 5,245.
14:20 Retailers are among the top performers in the FTSE 100 following today's Budget. Chancellor George Osborne has unveiled a rise in VAT to 20% from 17.5% from January 4, but the move had been widely anticipated. Clothes retailers Marks & Spencer and Next, Argos and Homebase owner Home Retail Group, supermarkets Wm Morrison and Tesco and B&Q owner Kingfisher are in the top 10. Hotel and coffee shop operator Whitbread, which saw a 7.6% rise in like-for-like sales in the 13 weeks to 3 June, is today's top riser, but Footsie is lower overall, down 58 at 5,240.
13:25 Footsie has barely flickered on the raft of new tax proposals proposed by George Osborne. It has been a long time since a chancellor reeled off such a list of tax increases and perhaps investors are taking time to absorb it all. VAT is going up, CGT is going up and banks have been bit with a levy. Even so, Footsie is still little changed with fallers still largely the miners and BP. FTSE 100 down 81 at 5,217.
13:22 Capital gains tax for higher rate payers will rise to 28% from midnight tonight from 18% currently.
13:15 VAT will rise to 20% from 17.5% from January 4, Osborne says.
13:06 Corporation tax will fall by 1% over the next four years to 24% from the current 28%, Chancellor George Osborne says.
12:45 Most of the budget deficit reduction will come from spending cuts rather than tax rises, Osborne has said.
12:34 Chancellor George Osborne has begun his Budget speech. He says he wants there to be an 'enterprise led' recovery.
12:25 Footsie has continued drifting lower, leaving just five stocks in the blue. Mexican silver miner Fresnillo is the heaviest faller as metal prices fall. Bank Barclays is also weak. Oil group BG is down as crude prices slip back, as is BP. Among the handful of risers is hotel and coffee shop operator Whitbread which saw a 7.6% rise in like-for-like sales in the 13 weeks to 3 June as its low prices attracted customers during the uncertain economic conditions. FTSE 100 down 80 at 5,219.
10:30 Only nine FTSE 100 stocks are posting gains as resource stocks weigh on the FTSE 100. Miners retreat after gains yesterday on the back of China's decision to de-link its currency from the dollar. Fresnillo is the heaviest faller. Oil stocks BG and Cairn Energy are lower in line with the oil price. Among the risers is hotel and coffee shop group Whitbread, which saw a 7.6% rise in like-for-like sales in the 13 weeks to June 3. FTSE 100 down 61 at 5,238.
09:10 Resource stocks are dragging Footsie slightly lower, with miners giving up yesterday's gains and oil group BP continuing its descent. Fresnillo and Kazakh pair ENRC and Kazakhmys are the worst hit miners. The sector was on the front foot yesterday after China's decision to de-link its currency from the dollar. BP is continuing to suffer from the fallout of the Gulf of Mexico oil leak. Oil explorer Cairn Energy also falls back. FTSE 100 down 25 at 5,274.
08:40 Miners are on the retreat after yesterday's China-inspired run, dragging Footsie down with them. Fresnillo and Kazakhmys are the worst hit. BG is another weak performer. Whitbread is top of the list after a strong performance from Premier Inn and Costa Coffee in the last three months. FTSE 100 down 29 at 5,270.
Tuesday, June 22, 2010
Sunday, June 6, 2010
House prices catching up slowly
House prices are now less than 10 per cent below their 2007 peak, according to the Swindon-based Nationwide Building Society.
Prices have increased by 0.5 per cent month-on-month in May and the annual rate of house price inflation has dropped from 10.5 per cent to 9.8 per cent – but looking at the market generally, prices have gone up 12.2 per cent since the February 2009 trough.
The average price of a house is now £169,162.
Nationwide’s Chief Economist Martin Gahbauer said: “Housing market conditions remain characterised by thin transaction volumes and a relative scarcity of properties for sale, despite a slow return of more sellers in recent months.”
Mr Gahbauer said the forthcoming budget might have an effect on house pricing. “The coalition plans to increase the rate of capital gains tax charged on the disposal of non-business assets, potentially including second homes and buy-to-let investment properties,” he said.
“With regard to what the short-term impact will be on the housing market and house prices, the key question is around the timing and implementation of any CGT increase.
“If there is a time lag between the announcement of the increase and its actual implementation, then some second home owners and buy-to-let landlords may decide to sell in advance of the higher rate being introduced – it is difficult to know how many.
“The incentive to try to beat the higher tax rate is most pressing for those who have owned their properties for a relatively long period.”
Prices have increased by 0.5 per cent month-on-month in May and the annual rate of house price inflation has dropped from 10.5 per cent to 9.8 per cent – but looking at the market generally, prices have gone up 12.2 per cent since the February 2009 trough.
The average price of a house is now £169,162.
Nationwide’s Chief Economist Martin Gahbauer said: “Housing market conditions remain characterised by thin transaction volumes and a relative scarcity of properties for sale, despite a slow return of more sellers in recent months.”
Mr Gahbauer said the forthcoming budget might have an effect on house pricing. “The coalition plans to increase the rate of capital gains tax charged on the disposal of non-business assets, potentially including second homes and buy-to-let investment properties,” he said.
“With regard to what the short-term impact will be on the housing market and house prices, the key question is around the timing and implementation of any CGT increase.
“If there is a time lag between the announcement of the increase and its actual implementation, then some second home owners and buy-to-let landlords may decide to sell in advance of the higher rate being introduced – it is difficult to know how many.
“The incentive to try to beat the higher tax rate is most pressing for those who have owned their properties for a relatively long period.”
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