FTSE 100 snaps 3-day losing streak as oil majors rebound
U.K. stocks surged for the first time in four sessions Wednesday, with oil companies rebounding ahead of the highly anticipated informal OPEC meeting in Algeria.
The FTSE 100 index jumped 0.7% to 6,857.42, after closing at the lowest level since Sept. 16 on Tuesday.
The U.K. benchmark has been trading at the mercy of the oil markets in recent days, as investors track developments ahead of a meeting of members and non-members of the Organization of the Petroleum Exporting Countries on Wednesday.
There has been lots of chatter about whether the oil producers would reach an agreement to freeze output or cut it outright, but expectations for a deal in Algeria were low ahead of the meeting. Media reports say OPEC is ready to discuss a cut of almost 1 million barrels a day to production, which could then be agreed at the cartel’s summit in November.
Oil prices rose on Wednesday, helping lift the U.K.’s energy companies.
Shares of BP PLC advanced 1% and Royal Dutch Shell PLC gained 1.2%.
Movers and shakers: Shares in Royal Bank of Scotland Group PLC rose 1.3% after the bank agreed to pay $1.1 billion to a U.S. regulator to settle two lawsuits related to mortgage-backed securities.
The charge “fits comfortably within the £3.8 billion in provisions the bank has set aside,” said Connor Campbell, financial analyst at Spreadex, in a note.
Tui AG shares gained 3% after the travel operator said it was confident of delivering between 12% and 13% growth in underlying earnings for the year that ends Sept. 30.
A look back at his seven-decade career that included a Nobel Peace Prize for negotiating the Oslo Accords, which set forth the steps toward the establishment of a Palestinian state.
Smiths Group PLC shares were up 2% after the company said fiscal 2016 pretax profit rose 6.5% and posted a marginal drop in adjusted operating profit for the period, in line with guidance.
Shares in J Sainsbury PLC lost 2.2% after the U.K.’s second-biggest supermarket reported a decline in second-quarter comparable sales.
UK Mail Group dropped 0.6% after Germany’s Deutsche Post DHL Group said it has agreed to acquire the delivery company for 242.7 million pounds ($315.5 million) to strengthen its position in the U.K. parcel market.
Carney optimism: Bank of England Governor Mark Carney told the Herald Scotland there are “positive long-term prospects for the U.K. economy”, but that growth following Brexit is going to slow.
Sterling traded around $1.2991, down from $1.3024 late Tuesday in New York.
Source: CNBC
