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Shy Ted

Housebuilders under pressure as placings suggest market top

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Housebuilders were under the cosh on Tuesday, weighed down by a series of share placings in the sector, a downbeat note from Bank of America Merrill Lynch and a report suggesting that smaller housebuilders are having difficulty accessing finance.

Redrow was the biggest faller after The Steve Morgan Foundation - a charitable trust founded by the housebuilder's chairman - and Morgan's investment vehicle, Bridgemere Securities, sold 25.9m existing ordinary shares at 590p each, representing around 7% of the issued share capital.

Cairn Homes was also in the red as it said its three founders are looking to sell around 15.65m shares in the company, or a 2.1% stake. Chief executive Michael Stanley and his brother Kevin - the chief commercial officer - along with co-founder Alan McIntosh, have appointed Goodbody as sole bookrunner.

Meanwhile last week saw Tony Pidgley, the founder and chairman of Berkeley Group, sell around 750,000 shares in the housebuilder, pocketing £26.8m.

Traders said the placings have raised concerns that this might be the market top for the sector, but Jefferies begged to differ.

"When Tony Pidgley and Steve Morgan sell shares in the companies they founded, investors take notice and ask if the silverback alpha males in the sector are calling the top of the market. We do not think so," it said.


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