Battered property stocks rallied yesterday after short-sellers were encouraged to close positions in the ravaged sector.

Segro, up 10.75p at 97.75p, triggered the advances when it was revealed that the Slough-based developer had agreed to pay for easier covenants on its £1.7bn debt, which should see it avoid the need for a rights issue in the near future.

That development offered a stark contrast to Hammerson, its FTSE 100 peer, which yesterday won shareholder approval for its £584m rights issue. The Franco-British shopping centre owner rebounded 7% amid vague bid talk and an upgrade to 'overweight' by JPMorgan.

Harm Meijer, an analyst with the American bank, believes that only British Land, up 20.25p at 422.25p, or Unibail Rodamco, the Franco-Dutch property group, would have the financial muscle to pull off a deal, but added that Hammerson’s high-quality cash-flow should see it survive the present crisis.

The Times, Daily Telegraph