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Oil surge powers FTSE higher amid investor relief
Oil majors power FTSE 100 rally as Brent crude surges through $30 mark, with Saudi Arabia branding low price 'irrational'.
Oil majors have driven the FTSE 100 higher after Brent crude surged through the $30 mark, as Saudi Arabia's oil minister branded the beaten-up price 'irrational'.
Oil rose 5% to $30.29 a barrel, taking weekly gains to 6%, helping inject some relief into beaten-up markets. The FTSE 100 rose 104 points, or 1.8%, to 5,878, with oil majors among the biggest gainers.
'Oil prices made an impressive bounce to take both Brent and West Texas Intermediate back up above $30,' said Augustin Eden at Accendo Markets. 'However, note that oversupply still persists and a Saudi oil minister talking of irrational price levels does not a bull market make, especially when financial markets are not exactly known for their rationality.'
In a broad-based rally also supported by yesterday's hints of further quantitative easing from the European Central Bank, almost every stock on the FTSE 100 made gains.
Emerging markets-focused stocks performed well. Luxury goods maker Burberry (BRBY), which conducts a substantial amount of business in China, rose 3.9% to £11.98 while Aberdeen Asset Management (ADN) was up 3.8% at 234.2p.
Shares in Woodford Patient Capital (WPCT ) bounced after a sustained sell-off, up 3.5% at 90.7p.
Another investment trust in recovery mode was James Henderson's Lowland (LWI ), up 7.4% at £12.08 and towards the top of the FTSE Small Cap, after steep falls in the market turmoil. The shares are down 13% since the turn of the year.
A surge in Japanese stocks meanwhile help power small cap investment trust Baillie Gifford Shin Nippon (BGS ) 5.8% higher at 423.3p.
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Look up the shares
- Royal Dutch Shell PLC (RDSb.L)
- BG Group PLC (BG.L)
- BP PLC (BP.L)
- Antofagasta PLC (ANTO.L)
- BHP Billiton PLC (BLT.L)
- Burberry Group PLC (BRBY.L)
- Aberdeen Asset Management PLC (ADN.L)
- Pearson PLC (PSON.L)
- Tullow Oil PLC (TLW.L)
- Petrofac Ltd (PFC.L)
- Ophir Energy PLC (OPHR.L)
Look up the investment trusts
- Woodford Patient Capital Trust (Ordinary Share)
- Lowland (Ordinary Share)
- Baillie Gifford Shin Nippon (Ordinary Share)
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by David Kempton on May 24, 2016 at 17:15