Market round-up: FTSE edges higher as strong earnings offset oil price decline

UK and European struggled for direction on Wednesday (23 March 2016) as energy stocks were dragged lower by a sharp decline in oil prices. London's FTSE 100 closed up 0.10% to 6,199.11 and was followed in the black by Germany's Dax, which gained 0.33%. Elsewhere, France's CAC 40 and the Pan European Stoxx 600 closed 0.18% and 0.06% lower respectively

Oil prices tumble

Commodity-related stocks were under pressure on both of London's main benchmarks. Mining giants Antofagasta, Fresnillo, Anglo American and Glencore were all among the worst performers on the FTSE 100, while Amec Foster Wheeler and Tullow Oil were among the main losers on the FTSE 250.

The decline in energy stocks came as oil prices plunged below $41 (£29.1, €36.7) a barrel. Brent crude lost 2.55% to $40.75 a barrel, while West Texas Intermediate fell 3.21% to $40.16 a barrel.

"The foundations of the recent recovery in oil prices look a little shaky and some temporary pull-backs may be inevitable," said Julian Jessop, head of commodities research at Capital Economics.

"Nonetheless, we continue to expect prices to recover further over the medium term, as reflected in our end-2017 forecasts of $60."

Kingfisher and Sky gain ground

However, there was better news elsewhere. Kingfisher led the risers on the FTSE 100 after the B&Q and Screwfix owner said its turnaround plan was on track as it posted a better-than-expected 0.3% gain in adjusted pre-tax profit.

Sky was also on the front foot, after analysts at investment bank Exane BNP Paribas upgraded their rating on the stock to 'outperform' from 'neutral', while mid-cap William Hill plunged after announcing its online profit is set to be approximately £20-£25m lower this year.

Travel stocks recovered losses they suffered in the previous session in the aftermath of the attacks on Brussels, with Thomas Cook among the day's winners on the FTSE 250.

FTSE 100 – Top 5 risers

Kingfisher +6.05%
Sky +2.47%
Berkeley Group Holdings +2.44%
Unilever +1.93%
Mediclinic International +1.91%

FTSE 100 – Top 5 fallers

Anglo American -5.40%
Fresnillo -4.93%
Glencore -4.41%
Standard Chartered -3.50%
Antofagasta -3.34%

FTSE 250 – Top 5 risers

Atkins +2.93%
Halma +2.68%
Thomas Cook Group +2.65%
Auto Trader Group +2.60%
Regus +2.44%

FTSE 250 – Top 5 fallers

William Hill -11.19%
Amec Foster Wheeler -8.22%
DFS Furniture -6.71%
Kaz Minerals -6.42%
Tullow Oil -5.71%