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LONDON (Alliance News) - Stocks in the UK opened higher Friday, with oil companies lifting the equity market as Brent crude climbed back above the USD50 a barrel mark, ignoring OPEC's failure to agree an output freeze.
Oil majors BP, up 1.8%, and Royal Dutch Shell 'B', up 1.1% were amongst the best performers in the FTSE 100, buoyed by the latest revival in oil prices. Early Friday, Brent oil was trading at USD50.11 a barrel, higher than the USD49.77 at the London equities close on Thursday.
The North Sea benchmark initially fell on Thursday after the Organization of the Petroleum Exporting Countries failed to agree on a supply limit. Iran refused to cooperate with requests to limit production as it attempts to make up for years of sanctions. However, OPEC officials expressed optimism that the crude oil market would continue self-adjust without a production freeze.
Brent regained some ground late Thursday as the US Energy Information Administration said its crude inventories fell by 1.4 million barrels in the week ended May 27.
Separately, BP said it has agreed to settle one of the many outstanding legal claims made against the company following the Deepwater Horizon oil spill in the Gulf of Mexico back in 2010, after agreeing to pay some of its investors USD175.0 million.
US Federal and District Courts certified a legal case back in May 2014 that was brought against the company by a group of investors that purchased BP's US-listed American Depositary Shares after the oil spill occurred.
The FTSE 100 was up 0.8%, or 49.86 points, at 6,235.47. The FTSE 250 index was up 0.25 at 17,108.01, and the AIM All-Share was up 0.2% at 741.16.
The CAC 40 in Paris was up 0.3% and the DAX 30 in Frankfurt was up 0.2%.
In Asia, the Nikkei 225 index in Tokyo and the Shanghai Composite both closed up 0.5% and the Hang Seng in Hong Kong is up 0.3%.
In other UK corporate news, Marks & Spencer Group was again amongst the biggest fallers in the FTSE 100. Having fallen 3.9% on Thursday when it went ex-dividend, the food, clothing and homewares retailer was down 1.7% on Friday after JPMorgan cut it to Underweight from Neutral according to traders.
Dechra Pharmaceuticals was also suffering from a downgrade. The FTSE 250-listed veterinary pharmaceuticals company traded down 3.1% after Jefferies cut it to Hold from Buy.
ICAP, the interdealer broker and trading platform provider soon to be renamed NEX Group, said it has secured a contract to provide fixed income and foreign exchange electronic execution services in mainland China through the China Foreign Exchange Trade System, the country's official inter-bank market trading platform.
EBS BrokerTec, ICAP's electronic foreign exchange and fixed income platform business, will handle the contract, which will be worth USD65.0 million over three years. The FTSE 250-listed company traded up 1.3%.
SeaEnergy said it has been placed into administration as marine engineering services company James Fisher & Sons acquired the AIM-listed firm's Return to Scene business.
SeaEnergy shares were suspended in April pending clarification of its financial position, after which KPMG was appointed to run an accelerated sales process.
Prior to the appointment of administrators to SeaEnergy, the company said the business, assets and employees of its SE Innovation unit were transferred to the Return to Scene subsidiary.
After this had occurred, and as confirmed on Friday, James Fisher struck a GBP1.9 million deal to acquire the Return to Scene business. Return to Scene provides visual asset-management photographic capture services, digital media services and forensic services to the oil & gas and security sectors.
James Fisher shares traded up 3.2%.
The main event in the economic calendar is the US jobs report for May at 1330 BST, which includes nonfarm payrolls, unemployment rate, earnings and labour force participation. This will be released alongside US trade balances.
"With rhetoric of late increasingly suggesting that a summer rate rise was a real possibility, any suggestion that the US jobs market is picking up steam more quickly than expected could well heighten expectations of the trigger being pulled again mid-month," commented Mike van Dulken and Augustin Eden at Accendo Markets.
Elsewhere, Markit Services PMI and Markit PMI Composite data are due from 0845 BST to 0930 GMT for the likes of Italy, France, Germany, the UK and the EU as a whole. EU retail sales data follows at 1000 BST. Later there are US Markit Services PMI and Markit PMI Composite at 1445 BST, ISM Non-Manufacturing PMI, and factory orders at 1500 BST.
By Neil Thakrar; neilthakrar@alliancenews.com; @NeilThakrar1
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