Gavekal Capital: Will Higher Rates Threaten the UK Housing Market?

Friday, June 13, 2014

Will Higher Rates Threaten the UK Housing Market?

Following Mark Carney's warning on mortgage debt and rising interest rates in the UK earlier today, homebuilders and home improvement stocks have (not surprisingly) underperformed:

Persimmon
image
Kingfisher
image

While one day's movement is not usually a major concern, the 7% and 4% declines, respectively, in Persimmon and Kingfisher will likely result in violations of their support in the longer-term point-and-figure charts:

image
image