LONDON MARKET MIDDAY: Ferguson And DS Smith Support FTSE; Oil Rallies

(Alliance News) - Despite a raft of ex-dividend stocks on Thursday, the FTSE 100 managed to trudge higher, bolstered by stock buying in plumbing firm Ferguson and some well-received annual results from packaging company DS Smith. Meanwhile, oil prices rallied on reports that two oil tankers have caught fire in the Sea of Oman.The FTSE 100 was up 13.83 points, or 0.2%, at 7,381.45 Thursday midday. The FTSE 250 was down 63.68 points, or 0.3%, at 19,186.38 while the AIM All-Share was down 0.2% at 942.03.The Cboe UK 100 index was up 0.1% at 12,518.21. The Cboe UK 250 was down 0.3% at 17,224.20 with the Cboe UK Small Companies down 0.1% at 11,672.45."Absence of fresh trade tension news and a rally in Ferguson are helping the FTSE trade slightly higher with the plumbing merchant attracting significant buying," said Fiona Cincotta at City Index. However, she added: "The index's anaemic rally is being held in check by the limbo ahead of the first Tory leadership vote and a plunge in Persimmon's shares."Shares in housebuilder Persimmon were down 4.7% at midday, despite Goldman Sachs resuming the stock at Buy, as it went ex-dividend, meaning new buyers no longer qualify for the latest payout.Other ex-dividend stocks on Thursday include WPP, down 3.5%, 3i Group, down 1.7%, and Severn Trent, down 1.7%.This was not enough to derail the FTSE 100, however, as Ferguson climbed 6.2% after funds managed by Trian Fund Management took a 5.98% stake in the plumbing and heating firm.The stake is worth around GBP736 million."Trian has contacted members of Ferguson's management team and looks forward to working with them to explore and implement initiatives that it believes can create long-term shareholder value," said Trian Investors 1.In mainland Europe, the CAC 40 in Paris and DAX 30 in Frankfurt both were up 0.1% and 0.5% respectively in afternoon trade.In the US, stocks are pointed towards a higher open, with the Dow Jones and S&P 500 both seen up 0.3% and the Nasdaq called to gain 0.4%.The US economic calendar has import and export prices at 1330 BST.In the UK, the race to become the next prime minister is set to narrow as Conservative members of Parliament hold the first ballot of the contest following a week of leadership pitches.Leadership hopefuls need at least 17 votes in the secret ballot to go through to the second round, with anyone below the threshold automatically eliminated. However, even if all the candidates meet the target, the one with the lowest number of votes overall will still have to exit the race.Among those in the race include former Foreign Secretary Boris Johnson, Home Secretary Sajid Javid, Environment Secretary Michael Gove and current Foreign Secretary Jeremy Hunt.Thursday's ballot is due to take place between 1000 BST and 1200 BST London time, with the result due to be announced at 1300 BST.The pound was quoted at USD1.2673 at midday, down from USD1.2727 late Wednesday.While the Conservative leadership contest chugs along in the UK, focus on Thursday has been on tensions in the Middle East."News this morning has been dominated by reports of damage to oil tankers in the Gulf of Oman. The number of attacks in the region is on the rise, with today's reports coming a day after explosions on board Iranian vessels," commented Chris Beauchamp at IG. Iran's navy rescued 44 crew members from two oil tankers which caught fire after an "accident" in the Sea of Oman on Thursday, official news agency IRNA reported according to Agence France-Presse."Forty-four sailors from the two foreign oil tankers which had an accident this morning in the Sea of Oman were saved from the water by the (navy) rescue unit of Hormozgan province and transferred to the port of Bandar-e-Jask," IRNA quoted an "informed source" as saying, AFP reported.The disruption in the region caused oil to shoot up from overnight lows, when the commodity traded below USD60 a barrel. Brent was quoted at USD62.00 at midday, up from USD60.85 at the London equities close on Wednesday."Oil prices have suffered heavily off the back of rising US crude stockpiles, but today the price of both Brent and WTI has rallied off the lows of June," Beauchamp said. "With an OPEC report due to be released soon, the oil price looks primed for further upside in the short-term at least."London-listed oil majors were tepidly higher at midday, with BP up 0.2% and Royal Dutch Shell 'A' and 'B' shares 0.5% and 0.4% higher respectively. On Wednesday, the stocks shed 2.9%, 1.1% and 0.9% respectively amid falling oil prices. Elsewhere in the FTSE 100, DS Smith was up 5.4% as it reported a strong set of annual results and raised its medium-term targets. For the 12 months to March, DS Smith's pretax profit rose 35% year-on-year to GBP350 million, with the adjusted figure up 31% to GBP569 million.Revenue for the period climbed 12% to GBP6.17 billion, with organic corrugated box volume growth 2.4% after a strong first half, though growth did ease slightly in the second half. This box volume growth was ahead of market growth, DS Smith added. The FTSE 100 firm reported a "record" return on sales margin of 10.2%, ahead of its 8% to 10% target. As a result, it has now upped its target to 10% to 12%.In the FTSE 250, life insurer Just Group gained 14% as it remained focused on delivering capital self sufficiency by 2022.Chair Chris Gibson Smith said he is focused on maximising shareholder value "with no options excluded".Just Group also said that all of its directors have recently increased, or are in the process of increasing, their shareholdings. This is to demonstrate their belief that the company's current share price "bears no relation to the fundamental value of our group".PZ Cussons was down 3.7% as the personal care products maker announced the immediate departure of Chief Financial Officer Brandon Leigh, while also reiterating annual guidance. The Imperial Leather soap maker did not say why Leigh has decided to leave after 13 years on the board as CFO. Commercial Finance Director Alan Bergin will take on the CFO role on an interim basis until a new permanent successor is found. Elsewhere on the Main Market, Majestic Wine slipped 7.1% after swinging to an annual loss and suspending its dividend. For the financial year ended April 1, the retailer recorded a pretax loss of GBP8.5 million compared with a GBP8.3 million profit the year before, on revenue of GBP506.1 million and GBP476.1 million, respectively. The company recorded a non-cash impairment charge relating to the Retail store estate of GBP11.1million in the period.Naked Wines, to which the company intends to shift its focus, delivered underlying sales growth of 15% in the year. Majestic Wine suspended its final dividend, having paid out 5.2p the year prior, but said it will replace this with a special dividend equal to last year's payout if the sale of its store estate goes through.London Midday is available to subscribers as an email newsletter. Contact info@alliancenews.com