U.K.'s Benchmark FTSE 100 Advances for Seventh Day; BP Shares Lead Gains
U.K. stocks rose for a seventh day, with the FTSE 100 Index heading for its longest streak of gains since July 2009, after BP Plc agreed to cancel its dividend and set up a $20 billion fund to compensate victims of the worst spill in U.S. history.
The benchmark FTSE 100 advanced 32.22, or 0.6 percent, to 5,270.14 at 2:40 p.m. in London. The FTSE 100 remains 49 percent higher than in March 2009 amid signs the global economy is recovering. Still, the gauge has fallen 9.4 percent from this year’s high on April 15 on concern that Europe’s debt crisis will hurt the economic recovery and as BP lost more than a third of its value following the oil spill. The FTSE All-Share Index rose 0.6 percent and Ireland’s ISEQ Index climbed 0.2 percent today.
“The setting up of a $20 billion claims response fund and a cut in the dividend has clarified two of the most important issues which have been overhanging the shares” of BP, Gordon Gray, a London-based analyst at Collins Stewart, wrote in a report today, recommending that investors buy the shares.
BP climbed 7.5 percent to 362.3 pence. The London-based slashed its $10 billion-a-year dividend and agreed to create an escrow fund to pay damages from Gulf of Mexico spill following a meeting between Chairman Carl-Henric Svanberg and U.S. President Barack Obama yesterday.
Game Group sank 5.8 percent to 83.1 pence. The retailer said sales at stores open at least a year fell 12 percent in the 19 weeks ended June 12.
WS Atkins Plc declined 4.1 percent to 696 pence after saying full-year revenue fell to 1.39 billion pounds.
Bodycote Plc climbed 3.8 percent to 203.9 pence as Arbuthnot Securities Ltd. upgraded the shares to “buy” from “neutral.”