LONDON MARKETS: FTSE 100 Breaks 3-day Losing Streak As Oil Companies Rebound
September 28 2016 - 12:26PM
Dow Jones News
By Sara Sjolin and Victor Reklaitis, MarketWatch
Pound slides back below $1.30
U.K. stocks rose for the first time in four sessions on
Wednesday, with oil companies rebounding amid a highly anticipated
OPEC meeting in Algeria.
The FTSE 100 jumped 0.6% to end at 6,849.38, 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 tracked developments ahead of a
meeting of members and nonmembers 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 ended up being low. The focus
has shifted somewhat to a meeting in two months. Media reports say
OPEC is ready to discuss a cut of almost 1 million barrels
(http://www.marketwatch.com/story/opec-to-discuss-cutting-oil-output-by-1-million-barrels-a-day-2016-09-27)
a day to production, which could then be agreed at the cartel's
summit in November.
Read:Why China is the oil 'wild card' that could overrule any
OPEC moves
(http://www.marketwatch.com/story/why-china-is-the-wild-card-that-could-overrule-any-opec-moves-2016-09-27)
Oil prices were choppy on Wednesday
(http://www.marketwatch.com/story/crude-higher-but-market-faces-long-wait-for-next-opec-move-on-output-2016-09-28),
but traded in the green by day's end in London, helping to lift the
U.K.'s energy companies.
Shares of BP PLC (BP.LN) (BP.LN) advanced 1%, and Royal Dutch
Shell PLC (RDSB.LN) (RDSB.LN) gained 0.7%.
Movers and shakers: Shares in Royal Bank of Scotland Group PLC
(RBS.LN) (RBS.LN) rose 1% after the bank agreed to pay $1.1 billion
(http://www.marketwatch.com/story/rbs-pays-11-billion-to-settle-lawsuits-in-us-2016-09-28-34851318)
to a U.S. regulator to settle two lawsuits related to
mortgage-backed securities.
The charge "fits comfortably within the GBP3.8 billion in
provisions the bank has set aside," said Connor Campbell, financial
analyst at Spreadex, in a note.
Banks throughout Europe also were getting a lift from a slight
recovery for Deutsche Bank's stock. The embattled German bank's
shares (DBK.XE) (DBK.XE) finished 2% higher in Frankfurt following
news it is selling an insurance business
(http://www.marketwatch.com/story/european-stocks-erase-monthly-loss-as-oil-firms-deutsche-bank-rally-2016-09-28),
as the country's government denied a report it is readying a rescue
plan for the bank
(http://www.marketwatch.com/story/german-government-preparing-rescue-plan-for-deutsche-bank-report-2016-09-28).
Back in London, TUI AG shares gained 1.2% after the travel
operator said it was confident of delivering between 12% and 13%
growth in underlying earnings
(http://www.marketwatch.com/story/tui-says-on-track-for-12-13-fy-earnings-growth-2016-09-28)
for the year that ends Sept. 30.
Smiths Group PLC (SMIN.LN) shares finished up 4% after the
controls company said fiscal 2016 pretax profit rose 6.5%
(http://www.marketwatch.com/story/smiths-group-pretax-profit-rises-65-2016-09-28)
and posted a marginal drop in adjusted operating profit for the
period, in line with guidance.
SABMiller PLC (SAB.JO) (SAB.JO) gained 0.6% after the $100
billion-plus megamerger between the U.K. brewer and Anheuser-Busch
InBev NV (ABI.BT) was approved by both companies' shareholders
(http://www.marketwatch.com/story/sabmiller-shareholders-approve-ab-inbev-merger-2016-09-28-6485648).
Shares in J Sainsbury PLC (SBRY.LN) lost 3.9% after the U.K.'s
second-biggest supermarket reported a decline in second-quarter
comparable sales
(http://www.marketwatch.com/story/sainsburys-comparable-sales-fall-11-2016-09-28).
Outside the U.K.'s main index, UK Mail Group (UKM.LN) jumped 43%
after Germany's Deutsche Post DHL Group (DPW.XE) said it has agreed
to acquire the delivery company
(http://www.marketwatch.com/story/deutsche-post-strikes-deal-to-buy-uk-mail-2016-09-28)
for 242.7 million pounds ($315.5 million) to strengthen its
position in the U.K. parcel market.
Carney optimism: Bank of England Gov. 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
(http://www.heraldscotland.com/news/14767907.Carney__No_end_in_sight_for_North_Sea_oil_gloom/).
Sterling traded around $1.2998, compared with $1.3024 late
Tuesday in New York.
(END) Dow Jones Newswires
September 28, 2016 12:11 ET (16:11 GMT)
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