London’s blue-chip stocks ended the week on a lower note, after the oil price reversed following the Organization of the Petroleum Exporting Countries (OPEC) meeting.
OPEC dashed any chances that it would ease off the production throttle and instead decided to up output, reports said.
According to unnamed sources, the oil production cartel has actually decided to crank up output levels from 30mln barrels per day (BPd) to 31.5mln BPd.
Oil had been higher at lunch, in anticipation of the meeting, with a barrel of Brent crude up 1.12% to US$44.34 while West Texas Intermediate was 1.1% higher to US$41.54.
By the close of play, however, Brent had lost 1.2% to US$43.28 while WTI slipped 2.2% to US$40.18.
It had an adverse effect on the oil stocks, with Shell (LON:RDSB) gushing 1.5%, or 24p to 1,604p while BP (LON:BP.) spilled 2.3%, or 8p to 360p.
The FTSE100, which had been just slightly lower at lunch, eased further, ending the day at 6,228, a drop of 46 points, and 147 points lower than last week’s close.
Conversely, in the US, The Dow Jones rose around 180 points in the first quarter of an hour to trade at 17,658, while the S&P 500 added 1% rising to 2,069.
Wall Street benchmarks raced to an early session lead on Friday after better-than-expected employment statistics indicated an improving American economy.
On the corporate front, house builder Berkeley Group (LON:BKG) climbed to the top of the index, as the firm said it is to increase its dividend payments by an additional 26% over the next six years.
The London and south-east focused housebuilder said fundamentals for the housing sector were very strong across the region with a substantial housing shortage evident. Shares jumped 7.5%, or 250p to 3,602p.
Elsewhere, accountancy software group Sage (LON:SGE) rose 5.1%, or 30p, to 611p after an upgrade to ‘outperform’ from JP Morgan.
Sticking with the brokers, JD Sports (LON:JD.) also did well among the 250 members after it issued a surprise and upbeat trading statement late afternoon yesterday.
Broker Investec upped its target price on the stock to 1,100p from 1,040p and reiterated its ‘buy’ recommendation. Shares gained 4.6%, or 47p, to 1,055p.
In the small cap space, Zincox Resources’ (LON:ZOX) shares are bouncing back strongly today after taking a fall yesterday on the news that Majedie Asset Management had sold its holding. Shares gained 57% to around 0.8p.
Also higher was Crimson Tide (LON:TIDE), which jumped 14% to 2.4p.
The roll-out of its mpro5 solution with one of the country's leading retailers, first announced in September, is ahead of schedule, which means revenues will roll in more quickly than originally anticipated.
Conversely, Papua Mining (LON:PML), saw its shares fall 17.6% or 0.4p 1.75p after the company announced plans to issue shares at a penny a pop.
LUNCHTIME REPORT
There was a new casualty as a result of the low commodity prices on Friday - shareholders Anglo American (LON:AAL).
The platinum miner is said to be planning to reduce its full-year dividend after metals prices fell to the lowest in about six years, according to reports.
The cut could be announced on Tuesday, when it hosts an investor day in London, with the miner looking to move its dividend to a ratio-based pay-out scheme.
A dividend pay-out ratio allows companies to adjust payments as profits rise or fall.
On Tuesday the firm will update shareholders on plans to combat the China-led commodities downturn.
Despite the speculation, Anglo was one of the top performing stocks on the FTSE100, as platinum gained 1% to US$855 per ounce.
The miner which has taken a pounding this month, losing almost a third of its value, gained 1.9% to 394p, but could not stop the FTSE100 falling.
The UK’s main index lost around 8 points to 6,266, despite house builder Berkeley Group (LON:BKG) climbing to the top of the index.
In complete contrast to Anglo, the firm is to increase its dividend payments by an additional 26% over the next six years.
The London and south-east focused housebuilder said fundamentals for the housing sector were very strong across the region with a substantial housing shortage evident. Shares jumped 7.4%, or 247p to 3,599.
Also higher were the oil firms, as a barrel of Brent crude rose 1.12% to US$44.34 while West Texas Intermediate lifted 1.1% to US$41.54.
On the index, Shell (LON:RDSB) gushed 1.6%, or 26p to 1,655p while BP (LON:BP.) climbed 1.4%, or 5p to 373p.
Away from the index, Ophir Energy (LON:OPHR) jumped 7.2% to 103p, while Premier Oil (LON:PMO) rose 4.6% to 68p.
It wasn’t all good news, however, as Premier Inn owner Whitbread (LON:WTB) lost 3.3% or 155p to 4,555p.
Barclays downgraded the company, which also owns Costa Coffee, to ‘equalweight’ from ‘overweight’ and cut its target price to 5,200p from 5,800p.
In the small cap space, Shares in postal service software provider Escher Group (LON:ESCH) plummeted on Friday as the firm warned lack of licence sales in its second half means it will miss full-year hopes.
The group said sales will be around US$22mln for the year to December, only US$1mln more than in 2014 while licence revenue will be materially lower. Shares dropped 36.3% or 80p to 140p.
Also lower was Motive Television (LON:MTV), which eased 28% to 0.02p as it looks to extend the deadline for conversion of its convertible loan notes.
On a more positive note, Zincox Resources’ (LON:ZOX) shares are bouncing back strongly today after taking a fall yesterday on the news that Majedie Asset Management had sold its holding. Shares gained almost 50% to around 0.8p.
Elsewhere, Tissue Regenix (LON:TRX) has treated its first two patients using its OrthoPure XT decellularised tendons.
The procedure using Tissue Regenix’s technology was part of a clinical trial aimed at securing regulatory sign off in the form of a CE Mark in the EU in 2017. Shares lifted 7.8% to 15.6p.
LONDON OPEN
London opened lower, but not by as much as expected despite the disappointment with ECB president Mario Draghi’s stimulus measures yesterday.
FTSE 100 dipped 10 points to 6,264 matching with similar–sized falls in France and Germany.
US markets had seen a near rout overnight as the ECB clipped its deposit to minus 0.3%, from minus 0.2%, in the latest attempt to get eurozone banks lending again.
Markets had been expecting a lot more. Today attention switches back to the US, where non-farm payrolls data for November is forecast to be the final dot on an interest rate rise in two weeks. Around 200,000 new jobs is the consensus.
London housebuilder Berkeley Group (LON:BKG) bucked the trend with another bumper set of results, but it was the 26% increase in its dividend projections for the next six year that caught the eye.
Berkeley raised the amount it will pay out by 2021 to £16.34 from £13, due to the underlying fundamental strength of the London market it said.
Shares rose 8% to 3,608p, with fellow housebuilder Persimmon (LON:PSN) 1% higher to 1,950p in sympathy.
Oil companies were flat ahead of the latest OPEC meeting.
Companies will be hoping for a cut in production to boost the oil price, but commentators said that looked unlikely. Shell (LON:RDSB) rose 12p to 1,641p even so.
Elsewhere, accountancy software group Sage (LON:SGE) rose 3% to 599p after an upgrade to ‘outperform’ from JP Morgan.
JD Sports (LON:JD.) also did well among the 250 member after it issued a surprise and upbeat trading statement late afternoon yesterday.
Like Berkeley, business at the sportswear and trainer retailer is booming. Shares rose 30p to 1,038p.
News that its new knee ligament replacement had been used in two thirty-something patients sent Tissue Regenix (LON:TRX) up 7% to 15.5p.
Small cap movers included zinc recycler Zincox Resources (LON:ZOX), up 20% after heavy falls recently on refinancing worries.
A profit warning sent Escher Group (LON:ESCH) tumbling 30% to 155p. The point of service software provider warned that profits will be lower than expected as a result of a shortfall in revenues.
Bulletin board favourite Motive Television (LON:MTV) dipped 28% to 0.022p even though it said talks on extending the deadline for conversion of its loan notes are progressing.