Sector movers: Persimmon cements gains for house-builders

28th Feb 2012 16:27

A 13% surge in the stock price of Persimmon boosted the household goods and home construction higher on Tuesday.While house-builder Persimmon's results appeared to be broadly in line with expectations, shares soared on news of a cash return worth £1.9bn over the next nine and a half years, something that Peel Hunt has called a 'game-changer'. "The decision to pay out 620p of surplus capital and cash flow is a game-changer. It shows a far more disciplined approach to the cycle and means that Persimmon will not be drawn back into a destructive volume spiral," said Peel Hunt analyst Robin Hardy. Meanwhile, underlying pre-tax profits increased 55% to £148.1m in 2011, higher than market expectations of £141.1m.Sector peers Barratt Development and Bellway were performing well, while Taylor Wimpey was making hefty gains of 6.7% ahead of its full-year results tomorrow.Automotive and aerospace engineer GKN dragged the automobiles and parts sector down today.The stock fell nearly 5% despite hiking its total dividend by a fifth after seeing double-digit growth in both sales and profits in 2011. The group did however report a subdued performance in GKN Aerospace as it has struggled with governments' defence spending remaining under pressure. Neverthless, stronger growth in its Driveline, Powder Metallurgy and Land Systems divisions meant that group sales rose by 13%. Analysts at Digital Look have highlighted the fact that, prior to today's announcement, the stock had risen by around a third since mid-December.BCTop performing sectors so far todayIndustrial Metals & Mining 4,563.96 +2.35%Household Goods & Home Construction 7,101.67 +1.72%Technology Hardware & Equipment 768.63 +1.59%Mining 22,755.26 +1.00%Software & Computer Services 818.25 +0.99%Bottom performing sectors so far todayAutomobiles & Parts 5,160.11 -5.08%Construction & Materials 3,660.73 -1.57%Health Care Equipment & Services 3,489.34 -1.16%Aerospace and Defence 3,639.42 -0.81%Chemicals 8,180.83 -0.76%