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Market Watch


SHARES in Persimmon are off the recent record high as some investors took profits on concerns about the future performance of the housing market.

Unlike most of its rivals, Persimmon edged up profits, prompting brokers ABN Amro to upgrade its rating from 'add' to 'buy' up to 1,580p.

ABN said the market was pricing in a decline in house prices and Persimmon stood out among smaller peers on valuation grounds. But this did not deter the profit takers and the shares lost 31p to 1,397p by Friday's close.

Profits at Wilson Bowden, parent of David Wilson Homes, fell. This prompted brokers Merrill to cut estimates, while Teather & Greenwood kept a 'hold' rat ing up to 1,488p.

T&G analyst Kate Moy said: 'Last year was a tough trading year for David Wilson Homes, with the group faring rather less well than we would have expected.' Wilson Bowden's commercial work ? an activity that Persimmon does not share ? generated more optimism and helped lift the stock 19p to a 12-month high of 1,511p.

Taylor Woodrow hit a high of 418.25p, up 5.5p, after emulating Persimmon in raising profits, prompting Citigroup to hoist its target price 72p to 467p.

Among the services contractors, Mitie firmed 1.5p to 205.75p as brokers UBS raised its target price 15p to 205p, retaining a 'neutral' rating.

Elsewhere, products firm SIG sagged 7.5p to 900p as Merrill downgraded its rating on the stock from 'buy' to 'neutral' and Hyder lost 1.5p to hit 270p as DrKW started coverage of the consultant with a 'buy' rating up to 305p.