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Brexit bar chat boosts FTSE as builders rally on delay hopes

Reports of UK chief negotiator Olly Robbins' overheard conversation in a Brussels bar boosts hopes of Brexit delay, buoying house builder shares.

Brexit bar chat boosts FTSE as builders rally on delay hopes

House builders have led the FTSE 100 higher, buoyed by strong results from Galliford Try and hopes of a delay to Brexit sparked by the UK's chief negotiator Olly Robbins' overheard conversation in a Brussels bar.

The UK blue-chip index rose 50 points, or 0.7%, to 7,183, as ITV reported Robbins (pictured) had been overheard saying prime minister Theresa May would wait until March before giving MPs the option of her deal or a long extension to article 50.

'Extension is possible, but if they don't vote for the deal then the extension is a long one,' he said.

That buoyed shares in house builders, sensitive to the outcome of the Brexit process.

On the FTSE 100, Persimmon (PSN) rose 2.2% to £24.47, Taylor Wimpey (TW) was up 1.5% at 166.7p and Berkeley (BKGH) rose 1.1% to £38.17.

Smurfit Kappa (SKG) reported strong earnings, up 25% to €1.6 billion (£1.4 billion) for the year, driving shares in the packaging firm up 2.4% to £23.20. This lifted rival DS Smith (SMDS) 4.8% higher to 352p.  

Galliford Try (GFRD) led the way on the FTSE 250, jumping 7.2% to 771.5p thanks to the builder's a 4% rise year-on-year in pre-tax profits to £84.2 million for six-months to the end of December.

Dunelm (DNLM) was also among the biggest risers in the mid cap index.

Shares in the home furnishings business rallied 3.3% to 740.5p, after building on a positive January trading update with first-half results which saw big growth in revenue, profit and cash flow.

Pre-tax profit grew 14% year-on-year to £70 million and like-for-like revenue increased 6.9% to £506.7 million in the second half of 2018. 

However, the furniture maker also warned it was stockpiling ahead of the Brexit deadline on March 29, having ‘identified some risks arising from potential disruption at deep-sea ports in the period following exit’.

AJ Bell investment director Russ Mould hailed the strong results amid a difficult retail environment.

‘Unlike many of its rivals this is not a case of internet sales coming to the rescue of ailing bricks and mortar stores. The online side is growing faster but both parts of the business are currently heading in the right direction.’

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