London close: Stocks end session higher as OPEC agrees to cut output

London stocks ended the session higher on Wednesday as oil prices jumped on the back of an OPEC deal to slash production.

The FTSE 100 closed up 0.17% to 6,783.79 points.

OPEC agreed to cut production to 32.5m barrels per day, marking the first reduction in the oil cartel's output in eight years.

Saudi Arabia said it would take a “big hit” while Iran was allowed to ramp up production to pre-sanction levels.

Brent crude exceeded the $50 per barrel mark, rising 7.2%, while West Texas Intermediate surged 6.7% to $48.49 per barrel at 1618 GMT.

“The cartel has shown united front and this is what matters the most,” said Naeem Aslam at Think Markets. “There have been so many doubts over the year if they have the ability to deliver anything and today they have.”

Oil giants Shell and BP were among the top risers on the FTSE 100, benefitting from the increase in oil prices.

In contrast, shares in airlines easyJet and British Airways owner IAG were both lower as higher oil prices will represent an increased cost headwind.

Elsewhere, consumer goods group Unilever advanced on investors' renewed interest in defensive stocks, analyst Mike van Dulken at Accendo Markets said, plus was holding an investor event in London on Wednesday.

Positive broker comment helped hoist Ashtead Group onto the leaderboad, with RBC Capital Markets increasing its price target ahead of the plant hire outfit's second quarter results next week.

Zoopla gained as it reported a rise in full-year profit and revenue and announced the acquisition of estate agency website design and hosting business Technicweb.

Shares in outsourcing group Capita hit a 10-year low after analysts at HSBC warned the shares had the potential to crumble yet further than their already precipitous plunge since September's profit warning.

Pub group Greene King was in the red as it reported a jump in first-half profit but warned over rising consumer and cost pressures.

Royal Bank of Scotland shares declined after failing all of the Bank of England’s annual stress tests and was forced to submit plans to strengthen its balance sheet. The lender has agreed a revised capital plan with the Bank of England's Prudential Regulation Authority to raise at least £2bn of extra capital.

Rivals Barclays and Standard Chartered failed some BoE requirements but will not require fresh capital.

Speaking on the risks to UK banking following the stress test results, BoE Governor Mark Carney warned the EU will face major hits to its economy if it does not agree to a transitional period to allow banks and finance firms time to adapt to Brexit.

On the economic data front, private sector employment in the US rose much more than expected in November, according to ADP.

Employers added 216,000 jobs, which was a much bigger increase than the 165,000 expected by economists. Meanwhile, the October figure was revised down to show that 119,000 jobs had been added rather than the 147,000 previously estimated.

The Commerce Department revealed US personal spending climbed 0.3% in October following an upwardly revised 0.7% increase a month earlier, missing forecasts for a 0.5% gain.

Personal incomes expanded 0.6% last month after an upwardly revised 0.4% rise in September, beating estimates for unchanged growth.

The personal consumption expenditures (PCE) price index rose an unchanged 0.2% month-on-month in October. The core PCE, which excludes food and energy prices and is the Federal Reserve’s preferred measure of inflation, gained 0.1% month-on-month after rising by the same margin in September.

Data from the National Association of Realtors showed US pending home sales nudged up in October. The NAR’s monthly index inched up to 110.0 last month from a slight downward revision of 109.9 in September and in line with consensus forecasts.

Closer to home, the latest survey from market research firm GfK revealed UK consumer and business confidence fell further in November amid worries about the impact of the Brexit vote.

GfK’s long-running consumer confidence index fell five points to -8, missing expectations of a decline to -4.

Market Movers

FTSE 100 (UKX) 6,783.79 0.17%
FTSE 250 (MCX) 17,545.75 0.08%
techMARK (TASX) 3,251.66 -0.72%

FTSE 100 - Risers

Royal Dutch Shell 'B' (RDSB) 2,118.50p 4.28%
Royal Dutch Shell 'A' (RDSA) 2,026.00p 3.95%
BP (BP.) 459.45p 3.82%
Ashtead Group (AHT) 1,567.00p 3.71%
3i Group (III) 689.00p 2.45%
Pearson (PSON) 795.50p 2.18%
Unilever (ULVR) 3,196.00p 2.11%
Hikma Pharmaceuticals (HIK) 1,701.00p 1.92%
Standard Chartered (STAN) 641.10p 1.55%
Coca-Cola HBC AG (CDI) (CCH) 1,700.00p 1.49%

FTSE 100 - Fallers

Capita (CPI) 524.50p -5.92%
Fresnillo (FRES) 1,200.00p -2.76%
Sage Group (SGE) 657.50p -2.66%
Rio Tinto (RIO) 2,990.00p -2.51%
Randgold Resources Ltd. (RRS) 5,700.00p -2.48%
International Consolidated Airlines Group SA (CDI) (IAG) 433.50p -2.47%
Imperial Brands (IMB) 3,433.00p -2.42%
AstraZeneca (AZN) 4,149.50p -2.27%
United Utilities Group (UU.) 883.00p -2.21%
easyJet (EZJ) 990.00p -2.08%

FTSE 250 - Risers

Cairn Energy (CNE) 208.60p 14.18%
Tullow Oil (TLW) 297.80p 13.32%
Hunting (HTG) 540.00p 9.36%
Brewin Dolphin Holdings (BRW) 287.40p 9.32%
Euromoney Institutional Investor (ERM) 1,078.00p 7.80%
RPC Group (RPC) 1,077.00p 7.49%
Amec Foster Wheeler (AMFW) 436.80p 7.14%
Zoopla Property Group (ZPLA) 334.90p 4.98%
Britvic (BVIC) 571.50p 4.29%
Sports Direct International (SPD) 309.00p 4.22%

FTSE 250 - Fallers

Playtech (PTEC) 859.00p -6.83%
Rank Group (RNK) 194.20p -4.33%
Cranswick (CWK) 2,240.00p -3.74%
Greene King (GNK) 686.50p -3.51%
Restaurant Group (RTN) 324.90p -3.48%
Moneysupermarket.com Group (MONY) 265.00p -3.28%
IP Group (IPO) 138.10p -3.22%
Man Group (EMG) 113.50p -2.99%
GVC Holdings (GVC) 652.00p -2.90%
Mitchells & Butlers (MAB) 227.20p -2.86%