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BP outperforms amid EU summit concerns

Markets opened broadly flat this morning, investors cautious of committing themselves ahead of the European leaders summit which has been called tomorrow to finalise a solution to the debt crisis. The FTSE opened marginally higher, once again struggling for direction despite some solid results from oil and gas heavyweights BP and BG Group. BP announced strong third quarter profits and investors bought into the accompanying rhetoric from CEO Bob Dudley that the company has “turned a corner” following the Gulf of Mexico disaster last year. The asset realisation program was increased in scope to $45 billion, from the $30 billion previously planned, and news that exploration and production and shareholder returns were going to be in focus going forward was welcomed. The shares traded up 19p to finish higher by 4.4%, topping the FTSE 100 leader-board. Its smaller peer BG Group was also buoyed by positive results that showed a strong operational performance ahead of expectations. The company also upgraded its guidance on its liquefied natural gas division and highlighted exciting prospects in Brazil, pushing the shares up 3.8%.

Sentiment was however disturbed somewhat mid afternoon, news hitting the wires that a meeting of EU finance ministers (known as Ecofin) scheduled for tomorrow had been postponed. Whilst the aforementioned EU leader’s summit is to continue as planned, the hiatus could hinder the finalisation of the specific details of a solution, something the market has long been waiting for.

The FTSE initially dropped more than 1% before recovering slightly to close down 22.5 points (0.4%) at 5525. The DAX was an outperformer with its 0.1% loss, however the CAC40 suffered a heavy 1.4% fall. Gold moved around 2% higher in response to the news, pricing around $1699 per ounce at the time of writing.

This was posted in Bdaily's Members' News section by John Dance .