Broker tips: BHP Billiton, BP, Building materials sector

Investec has upgraded its stance on BHP Billiton from 'sell' to 'hold' following the spin-off of the miner's South32 portfolio this week, as well as recent reduced capital and operating cost guidance.

While many of BHP's remaining key commodities at prices not seen since 2009, the broker said: "We expect ongoing earnings growth to support the credit rating and the progressive dividend policy." Investec lifted its target price for the stock slightly from 1,329p to 1,383p.

JPMorgan Cazenove analysts have lifted their rating on oil major BP from 'underweight' to 'neutral' but retained a gloomy outlook on the European integrated energy sector.

Following recent outperformance, it recommended investors to sell shares in the sector "which will fade if the oil-price momentum weakens".

Shares of building materials peers Wolseley, Travis Perkins, Howden Joinery and Grafton Group were all on the rise on Friday after Jefferies took positive stance on the sector.

The broker upgraded all four stocks by two notches from 'underperform' to 'buy', saying the companies have solid shares in recovering markets, driven by an improving consumer demographics - demand is growing from older, more equity-rich homeowners - and continued investment.