Market Wrap, Thursday 29th May 2008

The FTSE closed only 1.5 points lower at 6,068.1, down about 62 poits from the day’s high.  The FTSE 250 closed up 40.9 points at 10,098.2.

Over the pond, the DJI was up 40 points at 12,634, whilst the S&P500 was up 7.5 points at 1,398, and the Nasdaq up nerly 14.5 points at 2,501.  The US Commerce Department said the first-quarter GDP growth was at an annual rate of 0.9%, which was better than the 0.6% expected, above 4th-quarter figure of 0.6%, although many had hoped to hit the 1% level. On to employment, where the Labor Department said that jobless claims were up by 4,000 to 372,000, which wasn’t quite as bad as many feared, but continuing unemployment claims stayed above the 3m level for the 5th week in a row.

Back here in London it was the banks and the housebuilders that had a poor day. With house prices down 2.5%, we’re told, and builders moth-balling projects, both sectors took hits.

The banks were down, with HBOS off nearly 17p at 414.25, barclays down nearly 10p at 377.5p, and RBS down over 6p at just shy of 232p. ABN Amro didn’t help, either, with their sector review that forecasts a strong reversal in both earnings yield and leverage, which have both helped drive up financial sector returns in recent years.

On to the housebuilders, where Persimmons was down 26p at 487.5p, Barratt Developments down 10.5p at 190p, Taylor Wimpey down 8p at 85.5p, and Bovis Homes down 19p at 429p. The only FTSE 100 memmber, Persimmons looks like it couldget kicked out in the reshuffle next month too. Building materials group Wolseley was also down 19.5p to cose at 537.5 after a Panmure Gordon reminder of their ’sell’ stance and 4-quid target.

BT Group didn’t have a good day, closing down over 4p at 222.25p after a SG Securities ’sell’ stance and 2-quid target was made apparent.

Trying to find some good news, oil heavyweights did well, despite the price of the black stuff down $3 to $4 today, as BP closed up 7p at 612.5p, RD Shell up 28p at 2,145, Tullow Oil up 24.5p at 922p, and Cairn Energy up 104p at 3,419.

On to financials again, where hedge fund manager Man Group closed up 30.5p at 619p after reporting a 60% growth in full-year profit, immediately nudging Credit Suisse to up its target by 30p to 670p.

On to the miners, where Rio Tinto closed up 43p at 6,180p after an upbeat production update, and ENRC was up 71p at 1,481p as those bid rumours are still doing the rounds.