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FTSE 100 little changed as broker upgrade for BT offsets weakness of oil titans

  • FTSE 100 edges 2 points higher
  • BP and Shell lower as oil price wanes
  • AJ Bell raises revenue guidance

The shortened week has got off to an indecisive start, or maybe traders just forgot to put their clocks forward on Sunday.

The FTSE 100 was up 3 points at 6,743 after 20 minutes of trading, despite oil giants BP PLC (LON:BP.) and Royal Dutch Shell PLC (LON:RDSB) falling back in line with the oil price.

“The other big developing story overnight is that the Ever Given ship blocking the Suez Canal has been successfully refloated, according to Inchcape Shipping Services, with the ship currently being secured,” observed Deutsche Bank’s Jim Reid.

“The news has sent oil prices lower this morning, and WTI (-1.59%) and Brent crude (-1.27%) prices have both fallen in response, even though it isn’t yet apparent how long it’ll take before the container ship can be moved out of the way and the canal cleared for others to pass through. For reference, the ship has been obstructing the route since Tuesday and it’s longer than the Eiffel Tower in length, and a number of container ships have already taken alternative routes and gone round the Cape of Good Hope, even though that adds over a week to the journey time,” Reid explained.

“The big question will now be how long before the Canal is back to normal service, as 12% of global trade goes through this route, and the issue has only added to the existing supply chain disruption thanks to the pandemic,” Reid said.

Offsetting the weakness of the oil behemoths was telecoms titan BT Group PLC (LON:BT.A), which was up 3.1% at 151.2p after Morgan Stanley moved from an ‘equal-weight’ position to ‘overweight, although its price target remained unchanged at 200p.

Also on the upgrade path was housebuilder Taylor Wimpey PLC (LON:TW.), up 0.9% at 181.8p. JP Morgan upgraded the stock to ‘overweight’ from ‘neutral’ although the price target has been left at 220p.

On the results front, trading platform operator AJ Bell PLC (LON:AJB) moved 1.8% higher to 416p after a trading update in which it upgraded revenue guidance for the year to the end of September.

“As a result of strong customer growth on the D2C platform, and elevated levels of dealing activity, the company expects revenues to be £6m ahead of consensus (given as £136m – so about 4% ahead),” commented Peel Hunt.

“We assume most of the incremental revenue would drop through to the bottom line, so the consensus profit estimate of £50mln should move higher,” the broker said.

6.35am: Cautious start expected

UK equities are set to start on a dull note, with the heavily-weighted oil giants tipped to weigh down the Footsie as oil prices recede.

The Ever Given, the vessel that has been blocking the Suez Canal, has been partially refloated and that has sent oil prices lower.

The FTSE 100 is expected to open 22 points weaker at 6,719.

US markets ended last week higher, while Asian markets this morning are mostly higher.

In the US, the Dow Jones added 453 points at 33,073 on Friday while the S&P 500 hardened 65 points to 3,975.

The Nikkei 225 is 350 points to the good at 29,526 this morning in Japan while in Hong Kong the Hang Seng index is 50 points heavier at 28,386.

A relatively quiet day is expected in London today despite the fact that because of Easter, five days of results have to be crammed into four days.

Around the markets

  • Sterling: US$1.3769, down 0.26 cents
  • 10-year gilt: 0.758%
  • Gold: US$1,725.80 an ounce, down US$6.50
  • Brent crude: US$63.29 a barrel, down US$1.28
  • Bitcoin: US$55,143, up US$280



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