With the absence of anything more pressing to deal with, the market gave some credit yesterday to those it had previously written off. It was a good day for housebuilders, pubs and newspapers, as investors took the view that they had been a little too hasty selling out and so bought back in, to avoid being caught short.

Taylor Wimpey led a resurgent housebuilding sector, as traders grew nervous that their bearish positions looked vulnerable. Covering of short positions, together with a report from the Centre for Economic and Business Research noting that a halt in housebuilding amid the credit crunch could fuel a 30 per cent rise in house prices between late 2009 and 2010, pushed its shares up 5¼p to 45¾p. Bellway, another builder hit hard in recent weeks, followed suit, up 33¼p to 507p, Persimmon rose 17p to 311½p and Berkeley was up 36½p to 778½p.

Trinity Mirror advanced 14½p to 115p, as yet another broker upgraded the Daily Mirror publisher. Lehman Brothers raised its rating to “equal-weight” from “underweight”, after the stock’s 70 per cent fall so far this year, noting that cyclical concerns were now priced in. Daily Mail & General Trust rose 1½p to 331½p.

Weekend press reports that CVC Capital Partners, the private equity group, was eyeing Punch Taverns lifted the spirits of the pubs sector. Punch rose 54½p to 312p amid hopes that CVC, which historically has been interested in pub investments, could make a move. However, some argued that although Punch shares may look cheap, its high borrowing remains a big obstacle to a bid. Mitchells & Butlers, at one stage linked with Punch and CVC, rose 25¼p to 280¾p, Wetherspoons added 14¼p to 233¼p, and Enterprise Inns gained 9p to 320¼p.

However, the FTSE 100 index closed down 34½ points at 5,320.2, dragged lower by commodity stocks. Miners were the biggest blue-chip losers as copper and platinum prices hit their lowest levels for months because of concerns that an economic slowdown would dent demand. Kazakhmys fell 135p to £12.88, Vedanta Resources lost 156p to close at £17.55 and Anglo American, also subject to a Goldman Sachs price cut, slumped 153p to £26.22.

After early gains, oil stocks also fell, with BP down 3¼p to 518p and Royal Dutch Shell 3p lower at £17.77. The reason? Oil briefly plunged below $119 a barrel for the first time in three months amid relief that Tropical Storm Edouard would spare energy facilities in the Gulf of Mexico. One bright spot for the sector was Imperial Energy, which rose 86p to £11.60, after confirming that it had received a second takeover approach, understood to be Sinopec, the Chinese oil group. Analysts believe that the Russia-focused Imperial may now be subject to a bidding war.

HSBCfell 9p to 828p after posting a 28 per cent fall in first-quarter net profit.

Galiform fell ¾p to 29¼p as the kitchen maker reported a drop in first-half pretax profits and cancelled its interim dividend in the tough market.

New York: Shares in the financial sector struggled because of fears that it could face further losses from the housing slump, but optimism over oil prices eased losses. At the close the Dow Jones industrial average was down 42.20 points at 11,284.20.

Explore Markets

• United States

• Europe

• Japan

• China

• Russia

• The Gulf

• India

• Africa

Times Recommends

• Lies and cover-up at MG Rover exposed by report
• High oil prices push manufacturing costs up
• Primark founder steps down as chief executive