FTSE 100 rises as oil stocks gain

Published On: July 5, 2022Categories: Stocks & Shares1.3 min read

The blue-chip FTSE 100 finished 0.9 per cent up and the domestically focussed FTSE 250 index closed 0.2 per cent lower

Britain’s top share index jumped on Monday as stable crude prices boosted oil stocks, while investors were waiting for the earnings season to pick up pace to assess the hit to profits from surging prices and higher interest rates.

The blue-chip FTSE 100 finished 0.9 per cent up and the domestically focussed FTSE 250 index closed 0.2 per cent lower with overall trading volumes lightened by a U.S. holiday.

Both the indexes started the second half of 2022 on a subdued note on Friday after a rough first six months on worries that aggressive rate hikes would trigger a global recession.

Oil majors BP and Shell on Monday advanced 4.4 per cent and 3.9 per cent respectively, as crude priced rose on concerns about tight supplies amid lower OPEC output, unrest in Libya and sanctions on Russia.

A small bounce back in the oil price was enough to give BP and Shell a lift and provide welcome support to the FTSE 100 index, Russ Mould, investment director at AJ Bell, said.

Fundamentally, supplies continue to be tight and there is still enough economic activity to stop oil prices slumping. However, lingering recession fears could act as a ceiling on the oil price, he said.

Auto Trader Group Plc gained 3.2 per cent after Peel Hunt upgraded the UK-based online car marketplace’s stock to “buy” from “add” on stable vehicle demand.

Grafton Group shed 7.7 per cent and weighed on the mid-cap index, after the building materials supplier said Gavin Slark would step down as chief executive on Dec. 31.

Pets at Home Group Plc dropped 8.3 per cent after Royal Bank of Canada downgraded the pet care retailer’s stock to “underperform”.

About the Author: Jonathan Adams

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