Housebuilders staged a dramatic recovery on the stock market on Wednesday as speculators keen to make a killing eyed up the companies wounded in the dramatic declines of the past week.

Barratt Developments (BDEV) and Taylor Wimpey (TW) were the main beneficiaries although both Bovis Homes (BVS) and Redrow (RDW) saw their share prices rise even though they reported poor results and announced 750 redundancies.

Investors appeared to decide that stocks had fallen as low as they were going to and moved in. Barratt was by far the most popular and shares closed just shy of a 40 per cent gain at 54p, an increase of 15p. Taylor Wimpey was a little less popular but even so managed almost a 16.5 per cent rise, finishing at 30.25p, up 4.25p.

The rise will be especially welcome to Barratt, which issues a trading update on Thursday and could disclose the latest developments on its rights issue.

The change in fortunes helped to deflect attention away from the performance of Redrow and Bovis – both of which have sites in the West Midlands and beyond.

The job cuts, equivalent to around 40 per cent of their workforces, brought the total number of job losses announced in the sector during the past week to at least 4,650.

Unlike the cuts announced by Barratt, Taylor Wimpey and Persimmon, the latest redundancies are unlikely to have much of an impact on the West Midlands.

Kent-based Bovis, which has sites in Great Barr and Walsall, will shut its eastern regional office in Cambourne, Cambridgeshire as part of its plans to trim some 400 jobs.

And Redrow, which has sites in Oldbury, Solihull and Quarry Bank plus the Hemispheres scheme in Edgbaston and the Jupiter building in Birmingham city centre, is closing two of its 10 offices – in Warrington and Basingstoke – and reducing its headcount by around 350 to 850, having already seeing staff numbers decline by 150 since the start of the year.

The job cuts come as housebuilders struggle against plunging sales and property price values.

Persimmon said 1,100 office jobs and 900 on-site jobs had gone so far this year, 280 of them in the Midlands.

Redrow, headquartered in Ewloe, Flintshire, said it had seen an “unprecedented decline in the fortunes of the UK housing market”, with sales of new homes down by 19 per cent to 3,925 in the year to the end of June.

Keith Bowman, equity analyst at Hargreaves Lansdown Stockbrokers, said: “The picture across the housebuilding sector is bleak.” He added that investors were concerned that “the fight has now become one of survival”.

Redrow’s forward sales as at the end of June have nearly halved from 2,148 this time last year to 1,189, according to the group.

The firm added that it expected to take a “significant” hit on the value of land and work in progress due to sharp property price falls, while it was also in negotiations over its banking agreements.

But Redrow said it had not breached any agreements with its banks as at June and reassured that full-year trading was set to be in line with its expectations.

Bovis, meanwhile, reiterated a warning that half-year profits would be hit by the decline in trading as it said sales plummeted by 32 per cent in the six months to June 30.

The group said average selling prices across private and social housing had dropped from £189,600 in the first six months of 2007 to £167,500 in the first half of 2008.

But Bovis hoped that the job losses and other cost saving measures would cut overheads by a fifth, although it would also take a one-off £2 million charge.

The group said it was merging the key functions of its northern and central regions, among other steps being taken to save cash.

Redrow closed at 100p, up 3.75p, an increase of almost four per cent, while Bovis closed at 323p, up 5.5p, an increase of two per cent.