Leading shares continued their revival ahead of Wednesday’s UK Budget and the US Federal Reserve meeting.
Hopes for tax changes in the Budget to boost North Sea oil investment, following a rise in costs and the slump in crude prices, have lifted energy companies. BG is 23.6p better at 845.6p, Centrica has climbed 6.3p to 245.6p and Royal Dutch Shell B shares are 39.5p better at £20.65. Premier Oil has put on 14.4p to 134.6p.
Overall the FTSE 100 is currently 29.16 points higher at 6833.24. Mike McCudden at Interactive Investor said:
Anticipation of a dovish stance from the Fed is once again propping up equities globally, but those late for the party could be in for a false dawn. Here in the UK oil stocks are being propped up in anticipation of supportive measures from a Chancellor who is expected to announce a giveaway budget ahead of the May election.
Elsewhere BHP Billiton is 29.5p better at 1445.5p after giving more details of the proposed spin-off of its aluminium, manganese, silver and coal businesses into a new company called South32. It will put less debt that expected into the $13bn venture to allow it to cope with tough markets and pay a dividend. Investec analyst Hunter Hillcoat said:
BHP Billiton has structured the demerged entity well and it should appeal to shareholders: limited gearing (low net debt just $674m), balance sheet flexibility ($1.5bn revolving credit facility to provide acquisition/investment firepower) and balanced shareholder returns (minimum 40% of earnings to be distributed as dividends each half year). BHP Billiton shareholders vote on 6 May and if approved, shareholders will receive a one-for-one in-specie distribution, with South32 to trade from 18 May.
But Chile’s Antofagasta has fallen 27.5p to 679.5p after it reported a 17.8% fall in first half earnings to $2.22bn, and said that protests and an adverse court ruling about enviromental issues cast uncertainty over its Los Pelambres mine.
Sainsbury shares have added 4.5p to 273.1p despite fourth quarter like for like sales falling 1.9%, the fifth quarter of decline. It said the market would continue to be challenging, but believed it would outperform rivals.
Among the mid-caps Just Eat, which floated almost a year ago at 260p a share, has climbed 10.3p to 373.6p after it reported a 62% rise in full year revenues to £157m and underlying earnings up 131% to £32.6m. It expects this year’s revenues to be more than £200m.
