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FTSE held back by housebuilders amid cladding cost reports

by LLB Reporter
10th Jan 22 9:26 am

The FTSE 100 stalled around the 7,500 mark on Monday morning as investors remain watchful of lingering Covid risks and the dangers posed by inflation.

AJ Bell investment director Russ Mould said: “Despite some tentative positivity in Asian trading, the UK index was not helped by a weak start for the housebuilding sector.

“The UK Government is reportedly looking for property developers to take on a greater share of the costs of repairing dangerous apartment blocks in the wake of the Grenfell tragedy in 2017.

“Many flat owners have been left with onerous costs for replacing flammable cladding and the latest reports on who will foot the bill should come as no surprise to the sector in that context.

“The housebuilders have benefited from generous incentives, such as Help to Buy and the mortgage guarantee scheme, in recent years. However, state support is not a one-way street and the sector needs to do its bit to look after its customers.

“With a quiet start to the week for big corporate and economic announcements, markets could remain in a holding pattern until Wednesday when US inflation figures will reveal just how acute inflationary pressures are in the world’s largest economy.”

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