It seems we may have found the bottom for oil prices.
The black stuff celebrated its biggest two-week rally in 17 years on Friday evening and yesterday managed to extend that winning streak, rising more than 2 per cent. It came as Deutsche Bank assessed the health of the oil services sector. The biggest beneficiary of this exercise was Hunting, which rocketed 50.9p to 548.5p as the bank upgraded the company to a buy. The company has also been talked about as a potential takeover target in recent weeks, which can’t have hurt.
A rally in oil and mining wasn’t enough to save the FTSE 100 from a 16.29 point fall to 6,837.15. Concerns around Chinese growth, the Greek debt crisis and unrest in Ukraine were blamed.
Microchip designers Arm Holdings and Imagination Technologies found themselves in the red after a key customer published disappointing results. Mediatek, which licenses their designs, put out weaker than expected guidance. Arm slipped 24p to 1,055p, while Imagination fell 7p to 254.5p.
United Utilities dropped 31p to 962.5p and Severn Trent fell 46p to 2,050p, with traders blaming the fall on a slump for US listed utility companies.
Deutsche Bank warned that RSA Insurance could be “coshed by interest rates”, sending it tumbling 15.3p to 439p.
MPs accused Shire of “industrial scale” tax avoidance on Friday; and the tax scandal involving HSBC, off 10.2p at 610.6p, reminded the City that the issue is still a pointed one, and Shire dropped 171p to 4,741p.
Despite oil’s recent relative strength, Kazakhstan-focused oil explorer Max Petroleum warned that the slump since November has put it on a path to insolvency unless it can restructure its debt and secure an injection of cash. Max Petroleum tumbled 0.46p to 0.11p.
City financier Nat Rothschild has stepped in to save the remains of the company he helped create. Mr Rothschild has agreed to inject $100m into coal miner Asia Resource Minerals, formerly known as Bumi, to allow it to restructure its debt. Asia Resource Minerals jumped 4p to 18.87p.Reuse content