London close: Stocks finish higher as oil prices rally

London stocks finished higher on Wednesday as oil prices gained after a report showed a surprise fall in US weekly crude inventories.

The Energy Information Administration said crude-oil stockpiles fell 3.4 million barrels in the week ended 6 May, compared to analysts’ estimates for a 400,000 increase. The report helped to ease concerns about a oil supply glut which has been blamed for pushing prices lower.

Brent crude jumped 3.1% to $47.00 per barrel and West Texas Intermediate gained 2.6% to $45.86 per barrel at 1635 BST.

Meanwhile, UK industrial production rose 0.3% in March on the previous month, up from the 0.2% decline in February but short of consensus estimates for a 0.5% gain, the Office for National Statistics said.

UK manufacturing output increased 0.1% month-on-month, an improvement on the 0.9% decline from the month before but short of the 0.3% increase the market was expecting and the ONS’s initial estimate of 0.4% growth.

EEF chief economist Lee Hopley said more evidence was coming through that the sectors hardest hit by the oil price collapse are now bottoming out while construction related sectors seem to be holding up.

“But, in line with the early warning signal from the PMI and the drop in consumer confidence, consumer facing sectors, including motor vehicles, are seeing weaker production trends at the start of the year," she said. "Whether this proves to be temporary is yet to be seen but UK manufacturers are far from alone in seeing this trend with other data from Europe suggesting that the industrial recovery is far from secure.”

In company news, shares in Barratt Developments fell despite the housebuilder saying it improved its sales rate in the 19 weeks since the start of the year and confirmed market conditions remained "strong".

Analyst Charlie Huggins at Hargreaves Lansdown noted that shares in housebuilders have been down of late, as measures such as price-to-book and cyclically adjusted price to earnings, mean the sector looking is trading at high valuations relative to history, meaning it could be vulnerable should the housing market slow.

Commercial property giants Land Securities and British Land, together with retail focused Intu Properties and Hammerson were also sitting lower amid uncertainty about Britain's future in the EU ahead of next month's referendum.

TUI was under the cosh as it revealed plans to sell UK sailing and outdoor holidays unit Specialist Group.

Anglo American, Randgold Resources, Fresnillo, Glencore, BHP Billiton and Antofagasta dominated the risers thanks to rises in precious metals and copper prices.

Market Movers

FTSE 100 (UKX) 6,162.49 0.09%
FTSE 250 (MCX) 16,710.67 -0.08%
techMARK (TASX) 3,077.15 0.23%

FTSE 100 - Risers

Anglo American (AAL) 617.30p 5.38%
Randgold Resources Ltd. (RRS) 6,095.00p 3.48%
Mondi (MNDI) 1,352.00p 3.21%
BHP Billiton (BLT) 837.50p 2.76%
Shire Plc (SHP) 4,190.00p 2.15%
Intertek Group (ITRK) 3,345.00p 2.11%
Glencore (GLEN) 136.70p 2.09%
Fresnillo (FRES) 1,075.00p 1.99%
Carnival (CCL) 3,611.00p 1.92%
Antofagasta (ANTO) 425.70p 1.74%

FTSE 100 - Fallers

Inmarsat (ISAT) 801.00p -2.61%
Land Securities Group (LAND) 1,150.00p -2.46%
British Land Company (BLND) 724.00p -1.76%
Provident Financial (PFG) 2,781.00p -1.73%
Intu Properties (INTU) 292.10p -1.68%
Hammerson (HMSO) 580.50p -1.53%
easyJet (EZJ) 1,489.00p -1.39%
ITV (ITV) 215.30p -1.37%
Royal Mail (RMG) 498.10p -1.37%
InterContinental Hotels Group (IHG) 2,709.00p -1.31%

FTSE 250 - Risers

Centamin (DI) (CEY) 113.50p 7.18%
Interserve (IRV) 314.20p 5.33%
Tullow Oil (TLW) 250.00p 4.82%
Renishaw (RSW) 1,954.00p 4.72%
Polymetal International (POLY) 697.50p 3.87%
Ibstock (IBST) 191.60p 3.62%
Cairn Energy (CNE) 206.70p 2.73%
Sophos Group (SOPH) 217.70p 2.50%
Barr (A.G.) (BAG) 545.50p 2.44%
Acacia Mining (ACA) 319.20p 2.44%

FTSE 250 - Fallers

William Hill (WMH) 306.00p -5.64%
P2P Global Investments (P2P) 871.00p -4.81%
Brown (N.) Group (BWNG) 238.90p -3.63%
OneSavings Bank (OSB) 274.60p -3.28%
Millennium & Copthorne Hotels (MLC) 427.70p -3.26%
Bovis Homes Group (BVS) 866.00p -2.42%
Allied Minds (ALM) 316.50p -2.31%
Workspace Group (WKP) 834.00p -2.23%
Ocado Group (OCDO) 288.50p -2.20%
Shawbrook Group (SHAW) 260.00p -2.15%