London close: Stocks gain on oil price rally, Greek bailout deal

UK stocks rallied on Wednesday as oil prices rose and Greece’s creditors agreed to unlock further bailout funds.

Oil prices were nearing the $50 a barrel mark after government data showed US weekly crude inventories fell more than expected last week, helping to ease concerns about a global supply glut.

The Energy Information Administration said inventories fell 4.2 million barrels per day to 537.1 million barrels in the week to 20 May, compared to analysts’ forecasts for a decline of 2 million barrels.

The report followed data from the American Petroleum Institute showing US crude stocks dropped by 5.1m barrels last week.

Brent crude rose 0.99% to $49.10 per barrel and West Texas Intermediate gained 0.51% to $48.87 per barrel at 1646 BST.

Meanwhile, Greece’s creditors have agreed a deal to unlock a further €10.3bn in bailout funds to ease the country’s debt burden. After an 11-hour meeting in Brussels, Eurozone ministers and the International Monetary Fund came to a deal to release the fresh loans to Greece after agreeing the nation had met its obligations through economic reforms.

The IMF also signalled that it could join the bailout by the end of 2016 following a debt-sustainability analysis.

In economic data, GfK’s forward-looking consumer sentiment index for Germany unexpectedly rose to 9.8 in June from 9.7 the previous month.

The IFO’s German business confidence index also rose to 107.7 in May from 106.6, beating estimates of 106.8.

Stateside, the Federal Housing Finance Agency revealed house prices rose more than expected in March. The home price index was 0.7%, compared to forecasts of 0.4% and the previous month’s 0.5%.

The US trade deficit on goods increased from $57.1bn in March to $57.5bn in April, according to the Department of Commerce. However, it was less than the $60bn shortfall which markets had been expecting.

Markit’s flash US services purchasing managers’ index fell to 51.2 from 52.8 in April, missing expectations for a reading of 53.1. Although it remained above the 50.0 mark that separates contraction from expansion, it was well below the long-run survey average of 55.6.

Among corporate stocks, oil producers were sitting higher on the pick-up in crude prices with BP, BHP Billiton and Royal Dutch Shell in the black.

Marks & Spencer’s shares plunged as the retailer posted an 18.5% drop in full year pre-tax profits and as chief executive Steve Rowe announced plans to lower clothing prices which may hit short-term profit.

Intertek was also in the red after saying its resource-related business continued to suffer from challenging markets in the first four months of the year.

Serco Group jumped after the outsourcing company said it expects underlying trading profit for 2016 to be ahead of current market forecasts following a stronger-than-anticipated start to the year.

Market Movers

FTSE 100 (UKX) 6,262.85 0.70%
FTSE 250 (MCX) 17,239.30 0.60%
techMARK (TASX) 3,116.37 0.58%

FTSE 100 - Risers

Royal Bank of Scotland Group (RBS) 256.00p 4.36%
International Consolidated Airlines Group SA (CDI) (IAG) 551.00p 3.67%
Standard Chartered (STAN) 554.60p 3.47%
HSBC Holdings (HSBA) 446.40p 2.80%
Glencore (GLEN) 133.30p 2.78%
BHP Billiton (BLT) 837.20p 2.51%
easyJet (EZJ) 1,556.00p 2.50%
Barclays (BARC) 185.85p 2.45%
Paddy Power Betfair (PPB) 9,110.00p 2.42%
BP (BP.) 366.00p 2.29%

FTSE 100 - Fallers

Marks & Spencer Group (MKS) 399.40p -10.19%
Intertek Group (ITRK) 3,109.00p -5.70%
Carnival (CCL) 3,489.00p -2.65%
Taylor Wimpey (TW.) 204.90p -2.57%
Rolls-Royce Holdings (RR.) 622.50p -2.51%
DCC (DCC) 6,530.00p -2.46%
Tesco (TSCO) 167.00p -2.34%
Land Securities Group (LAND) 1,180.00p -1.83%
St James's Place (STJ) 928.00p -1.64%
WPP (WPP) 1,590.00p -1.49%

FTSE 250 - Risers

Serco Group (SRP) 102.90p 12.46%
Zoopla Property Group (WI) (ZPLA) 337.80p 10.00%
Restaurant Group (RTN) 370.50p 4.93%
Clarkson (CKN) 2,455.00p 4.82%
Paysafe Group (PAYS) 407.10p 4.44%
Regus (RGU) 315.90p 4.12%
Virgin Money Holdings (UK) (VM.) 370.80p 4.07%
Paragon Group Of Companies (PAG) 311.70p 3.90%
Interserve (IRV) 331.00p 3.73%
Euromoney Institutional Investor (ERM) 1,025.00p 3.69%

FTSE 250 - Fallers

DFS Furniture (DFS) 298.10p -5.24%
Centamin (DI) (CEY) 101.20p -4.53%
AO World (AO.) 170.10p -2.80%
Big Yellow Group (BYG) 863.00p -2.65%
Wizz Air Holdings (WIZZ) 1,940.00p -2.46%
OneSavings Bank (OSB) 309.00p -2.40%
Acacia Mining (ACA) 314.00p -2.33%
Lancashire Holdings Limited (LRE) 573.50p -2.05%
Sophos Group (SOPH) 226.00p -1.74%
Debenhams (DEB) 73.85p -1.73%