Get 40% Off
🤯 This Tech Portfolio is up 29% YTD! Join Now to Get April’s Top PicksGet The Picks – Just 99 USD

Oil majors, exporters lead FTSE bounce

Published 21/08/2019, 09:12
Updated 21/08/2019, 09:12
Oil majors, exporters lead FTSE bounce

Oil majors, exporters lead FTSE bounce

By Shashwat Awasthi

(Reuters) - London's FTSE 100 rose on Wednesday as oil majors tracked gains in crude prices and a weaker pound led exporter stocks higher, while cautious investors awaited minutes of the U.S. Federal Reserve's July meeting for signs of further policy easing.

The main index (FTSE) added 0.8%, with a boost from Shell (L:RDSa) and BP (L:BP) helping the index recover most of the previous session's losses. The mid-cap FTSE 250 gained 0.5% by 0757 GMT.

BAT (L:BATS) and other stocks that book a major chunk of their earnings in dollars gained as the pound drifted lower again, ahead of Prime Minister Boris Johnson's meeting with German Chancellor Angela Merkel.

After the European Union rebuffed Johnson's demand to reopen the Brexit divorce deal on Tuesday, investors are looking for fresh signals that Europe would be willing to re-negotiate and help Britain stave off a disorderly exit from the bloc.

More broadly, traders have pinned their hopes on the U.S. Fed and other central banks lowering interest rates in the near-term to cushion blows from a bruising U.S.-China trade war and quell fears of an impending recession.

Such uncertainties have driven away investors from risky assets such as equities in recent weeks, putting the FTSE on course for its worst month in four years and making the Fed's minutes all the more crucial.

"There is likely to be interest as to whether there was any discussion about whether a cut was even necessary, or more importantly whether an even bigger cut of 50 bps was discussed," CMC Markets analyst Michael Hewson said.

"The tone of the discussions will also give a steer as to whether markets are right to expect another move in September."

Merging mid-cap lenders OneSavings (L:OSBO) and Charter Court Financial (L:CCFS) gave up 4.1% and 2.2% respectively, after they warned of Brexit impact on housing and credit.

Rating actions also drove steep moves among mid-cap and small-cap stocks.

Outsourcing group Capita (L:CPI) surged 6.2% to the top of the FTSE 250 after Goldman Sachs (NYSE:GS) upgraded the stock.

Small-cap Nostrum Oil & Gas (L:NOGN) plummeted 22% to an all-time low after Berenberg slapped the stock with a double-downgrade on its rating and slashed price target to 25 pence from 200 pence.

Latest comments

Risk Disclosure: Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers.
© 2007-2024 - Fusion Media Limited. All Rights Reserved.