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SHARE WATCH: Interest rate drop boosts construction shares

Construction shares reacted positively to the unexpectedly large Bank of England interest rate cuts yesterday, ending two days of falls.

The FTSE 350 Construction and Materials index rose 0.3 per cent this morning to 2,931 while the FTSE 350 Support Services was up 2 per cent at 2,683.

The FTSE 100 itself also saw positive gains on the back of interest rates being set at their lowest level since 1955.

The index was up 1.8 per cent to 4,350 in early trading.

All the house builders saw their share price rise, Taylor Wimpey leading the way with 13 per cent gains.

All the listed plant hire and building materials firms also saw gains.

However, all but White Young Green of the consultants recorded a drop in price.

And it was a mixed morning for contractors and support services firms, the biggest winner being Carillion with 7 per cent gains.

The biggest loser was Galliford Try with 8 per cent losses, after the contractor issued a gloomy trading statement including £50 million landbank writedowns.