FTSE 100: 7247.66 ▼ -47.04 (-0.64%)
Shares in house builders have fallen after Redrow (RDW) founder Steve Morgan and his charity sold a £152.8 million stake in the company.
Redrow was the biggest FTSE 250 faller on the news, dropping 7.8% to 583.3p.
The news also hit shares in rival house builders. On the FTSE 100, Taylor Wimpey (TW) fell 2.3% to 191.4p, Persimmon (PSN) dropped 1.6% to £25.15 and Barratt Developments (BDEV) was down 1.7% at 596p.
Morgan's sale of his stake follows Berkeley (BKGH) founder Tony Pidgley's offloading of a £26.8 million holding last week, and has sparked jitters among investors in the house building sector.
But Jefferies analyst Anthony Codling said he did not believe 'the silverback alpha males in the sector are calling the top of the market'.
He said that even with today's sale Morgan still held around a third of Redrow shares, while Pidgley remains the fourth largest Berkeley shareholder, arguing that both retained 'skin in the game'.
'We appreciate that the gurus in the sector carry more weight than we do, but should their share sales cause share prices to weaken we would encourage investors to add to their holdings,' he said.
'It is our assessment that the UK continues to experience a chronic under supply of housing. This coupled with an existing homes market in paralysis and the stimulus of Help to Buy, places the UK new build housing market in a very strong position, in our view.'