With crude oil prices near all-time highs and the dollar rising, the oil majors were always going to find support.
But investors may have been hoping for a bit more upside over BP after media reports suggested Abu Dhabi National Oil Company (ADNOC) had recently considered buying the energy giant.
However, the sources cited said that the UAE’s state oil company’s deliberations did not go beyond the preliminary stage, so that explains the less than euphoric response.
Plans reportedly stalled after ADNOC determined that BP was not the “right fit” for the company, although politics was also likely to be a factor, given tensions in the Middle East.
But the fact that ADNOC was even considering a full £90bn bid or taking a large stake in the company could set alarm bells ringing in the City. BP, which reported profits of more than £11 billion last year, is the lowest-valued global oil company measured by market capitalization versus cash flow.
Speculation: News reports suggested that Abu Dhabi National Oil Company had recently considered purchasing BP.
BP shares gained 3.7 per cent, or 19.1 pence, to 539.1 pence. Rival oil company Shell rose 2.8 percent, or 80 pence, to 2,937 pence.
Miners dominated the directory of blue-chip leaders, reflecting buoyant metals prices, including gold’s unstoppable rise to record levels.
Fresnillo, which mines the yellow metal, stood out, adding 7.6 per cent, or 44 pence, to 622.5 pence, and Chilean copper giant Antofagasta picked up 2.2 per cent, or 48 pence, at 2,266 pence. Strength in commodity issuance saw the FTSE 100 rise 0.9 per cent, or 71.78 points, to 7,995.58. The FTSE 250 index lost 0.3 per cent, or 65.63 points, to 19,721.24.
Not all commodity-related stocks were in the green. Petrofac plunged 20.5 per cent, or 6.82 pence, to 26.5 pence after the provider of infrastructure services to the energy sector updated shareholders on its ongoing strategic and financial restructuring efforts. The company said it “continues to face challenges” in securing new performance guarantees, but added that discussions were continuing.
Housebuilders were in demand after JP Morgan analysts highlighted recovery opportunities in the sector around the impending general election, with housing expected to be a key focus for all political parties.
US Bank analysts upgraded some housebuilders to ‘overweight’, including blue-chip Taylor Wimpey (up 3.3 per cent, or 4.35 pence, to 134.6 pence) and Persimmon ( up 1.3 per cent, or 16.5p, to 1,282p). .
But airline issues fell the most on the FTSE 100, with EasyJet losing 4.3 per cent, or 23.4 pence, to 527 pence and British Airways owner IAG losing 3.8 per cent. cent, or 6.45 pence, to 162.65 pence, weighed down by rising fuel costs and concerns about escalation. Tensions in the Middle East.
One of the big fallers among small-cap stocks was Bermuda-based specialist non-life insurer R&Q. It fell 45.4 per cent, or 2.49 pence, to 3 pence after warning of a significant annual pre-tax loss due to higher costs from the sale of a business unit.
Bens Creek, which owns metallurgical coal mines in North America, lost 32.4 percent, or 0.28 pence, to 0.58 pence on news that it laid off 44 workers in West Virginia due to the fall in prices and financial limitations.