Sector movers: Bullish Goldman note boosts house builders

9th Oct 2013 14:47

An aggressively bullish note from analysts at Goldman Sachs put a rocket up housebuilding and estate agency stocks on Wednesday. The influential broker said valuations for residential construction companies were too conservative, with the government's Help to Buy scheme helping lift British house prices at their fastest pace in 11 years. Goldman said sector median tangible book values should grow 62% between 2013 and 2017 and that the "UK housing recovery is underway", picking Taylor Wimpey as its 'conviction buy'. The sector was up 1.2% by mid afternoon, with all players enjoying a boost, led by FTSE 100 builder Persimmon up 5.2%, and the smaller Bellway and Barratt Developments both up at least 4%, along with estate agent Crest Nicholson. Goldman said: "We accelerate our view of UK housing market recovery, increasing our view of transaction growth to +15% per annum (PA, between 2014 and 2016) from +10%, +10%, +6%, and house price inflation to +6% PA from +4% PA over the same period. We now expect UK housing transactions to reach long-run levels by 2016 versus 2020 previously."Going the other direction, chip makers Imagination Technologies and ARM Holdings led the technology hardware sector hand-in-hand downwards after some less than positive coverage and tracking major customer Apple's journey southward. News on Tuesday that semiconductor group MediaTek had acquired a licence for rival microchip designer ARM's Cortex-A50 processor cores and Mali graphics technology hit IMG in the gut. This was followed on Wednesday by a unenthusiastic note from Deutsche Bank, where analysts reiterated their hold rating and 280p target price.IMG was down 4.3% on Wednesday afternoon, with ARM down 2.5%. Top performing sectors so far todayHousehold Goods & Home Construction 9,864.12 +1.16%Fixed Line Telecommunications 3,930.83 +0.81%Banks 4,844.86 +0.79%Electricity 9,350.80 +0.75%Real Estate Investment & Services 2,534.57 +0.68%Bottom performing sectors so far todayTechnology Hardware & Equipment 1,108.56 -2.27%Personal Goods 24,732.71 -1.57%Chemicals 9,509.29 -1.44%Food & Drug Retailers 4,577.12 -1.35%Forestry & Paper 11,029.87 -1.35%OH