BP shares have ticked up following a positive note from analysts at Credit Suisse, which suggests the company will shortly receive the benefit of the Gulf of Mexico oil leak finally being resolved and its internal enquiry into the disaster.
The company may have been forced to give up any hope of drilling in the Arctic following the Gulf spill, but Credit Suisse said the current share price weakness offered a good entry point for investors. It set an outperform rating on the shares - now up 9.1p at 384.25p - and a 515p price target. The bank said:
BP's shares have fallen by 14% since their highs in early August following a strong set of second quarter numbers. Despite the noise around legal bills and the delays to the relief well, we believe little has changed in the investment case. In our view, the underperformance has brought BP back to interesting levels, which offer 36% upside potential to our target price, by far the highest in the peer group.
In the next few weeks, we see two potential catalysts that could improve sentiment on the stock: (1) the BP internal investigation report on the Macondo accident to be released at end August - where BP will likely try to shift some of the responsibility to its contractors, and (2) the final well kill shortly after Labour Day (September 6)
Meanwhile, with mixed US jobs data, the FTSE 100 remains in positive territory, up 45.57 at 5154.97. Weekly US jobless claims fell by more than expected to 473,000 last week, but the four week average - a better indicator of the trend - rose to a nine-month high of 486,750.
