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LONDON (Alliance News) - Stocks in the UK opened higher Tuesday, lifted by a rebound in resource-sector stocks after the heavy losses incurred on Monday and by gains made by supermarkets following the latest survey figures from Kantar Worldpanel.
Oil-related stocks were hit hard on Monday as oil prices fell to fresh seven-year lows but were trading higher early Tuesday as oil prices came off the lows. Brent traded at USD37.70 a barrel compared to the USD36.32 a barrel low it touched on Monday. West Texas Intermediate was at USD36.13 a barrel, compared to its Monday low of USD34.51 a barrel.
Royal Dutch Shell 'A' was up 2.7%, BP up 1.3% and Tullow Oil up 5.9%.
Tullow also early Tuesday said it has encountered a net oil pay at the Etom-2 well in northern Kenya and said its Ngamia well in the country has produced thousands of barrels of oil per day under test conditions. The FTSE 250-listed oil producer said the Etom-2 well on Block 13T encountered 102 metres of net oil pay in two columns after being drilled to a total depth of 1,655 metres.
Mining stocks had dominated the fallers in the FTSE 100 on Monday and were amongst the best performers at the open Tuesday. Glencore was up 3.6%, BHP Billiton up 2.6% and Anglo American up 1.7%.
The FTSE 100 index was reading up 1.4% at 5,955.58 points, the FTSE 250 index was up 0.4% at 16,838.54, and the AIM All-Share was up 0.1% at 717.85.
In Europe, the French CAC 40 was up 1.5% and the German DAX 30 up 1.2%.
Asian stocks ended lower, with the Nikkei 225 index down 1.7%, the Hang Seng in Hong Kong down 0.2% and the Shanghai Composite down 0.3%.
FTSE 100-listed supermarkets were amongst the top gainers after the latest UK market share data from Kantar Worldpanel for the 12 weeks to December 6.
J Sainsbury was up 3.7% after Kantar revealed sales in the period rose 1.2% to GBP4.35 billion from GBP4.30 billion a year earlier, helping its market share rise to 16.7% from 16.5%.
Of the big four, it was the only one to have delivered higher sales and market share year-on-year, as its rivals continue to feel the effect of discounters Aldi and Lidl. Those two once more produced sterling growth in the period, with Aldi sales up 15% and Lidl sales rising 18% year-on-year, as the pair's combined market share stayed at 10%.
Tesco, up 3.2%, saw sales decline 3.4% in the period, with its market share shrinking to 28.0% from 29.1%, while Wm Morrison Supermarkets, up 4.1%, had a sales decline of 2.0%, while its market share slipped to 11.0% from 11.2%.
AVEVA Group was by far the worst performer in the FTSE 250, down 36%. The engineering software and IT systems provider said its proposed acquisition of industrial software assets from France's Schneider Electric SA has been terminated.
AVEVA and Schneider reached a non-binding agreement in July, under which AVEVA would acquire industrial software assets from Schneider in cash and shares, giving Schneider a 53.5% stake in the FTSE 250-listed company. The deal had been valued at around GBP1.3 billion.
But on Tuesday, AVEVA said the pair had been unable to reach a definitive agreement and said the talks had been terminated. The non-binding nature of the agreement means no break-fees will be paid by either side.
UBM was one of the top gainers in the midcap index, up 2.9%. The events and media company said it struck a deal to sell its PR Newswire business to private equity-owned PR software company Cision for USD810.0 million in cash and USD31.0 million in preferred equity.
Following completion of the deal, which is in line with UBM's decision to focus on its events business, the company intends to return GBP245.0 million to investors through a special dividend, with the remainder to be held to provide financial firepower for bolt-on acquisitions.
The deal will be subject to competition clearance in the US, PR Newswire's largest market, and is expected to be completed in the late part of the first quarter of 2016.
Imagination Technologies Group traded down 6.2% after it said its operating profit before items for the full year will be lower than its previous expectations after reporting a wider pretax loss and a fall in revenue during the first half.
The software and intellectual property licensing company said its operating loss before non-recurring items, impairments, restructuring costs, amortisation and non-cash share based incentives came in at GBP7.3 million in the first half to October 31, compared to a GBP5.0 million profit a year ago.
The company said it expects a "stronger" second half from its licensing division, with the company expecting a rise from in revenue from the second half of the last financial year. However, the board is expecting its overall operating profit before items for the full year to be "below its previous expectations".
Importantly, Imagination said its operating costs for the full year will have grown by around 2%, considerably less than its guidance range of 5% to 10%, saving the company an extra GBP5.0 million, it said.
The focus for the markets this week is the US Federal Reserve's monetary policy decision on Wednesday at 1900 GMT. Market participants overwhelmingly expect the central bank to raise interest rates for the first time in nearly a decade. The Fed will commence its two-day policy meeting later Tuesday.
Elsewhere in the economic calendar, UK retail, consumer and producer price indices are at 0930 GMT, just before ZEW economic sentiment surveys for Germany and the eurozone at 1000 GMT. The Bank of England's quarterly bulletin will be released at 1200 GMT. The New York State manufacturing index is at 1330 GMT, alongside US consumer price inflation also at 1330 GMT.
By Neil Thakrar; neilthakrar@alliancenews.com; @NeilThakrar1
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