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BP lifts FTSE towards 4-1/2 month high

Published 03/02/2015, 11:22
© Reuters. The London Stock Exchange is seen during the morning rush hour in the City of London
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By Alistair Smout

LONDON (Reuters) - FTSE rose towards a 4-1/2 month high on Tuesday, boosted by commodity stocks after BP (L:BP) beat earnings expectations.

The blue-chip FTSE 100 (FTSE) index was up by 1.2 percent at 6,864.57 points as it went into the middle of the trading session, its highest level since September 2014.

Oil major BP rose 2.5 percent after it beat quarterly profit expectations despite taking a $3.6 billion impairment charge in the face of low oil prices.

A slide in Brent crude , down 50 percent since last June, prompted BP to cut its capital expenditure, although it was able to maintain a quarterly dividend of 10 cents.

"On a standalone basis BP represents good value and with these numbers, we expect buying to come back into not only the sector but BP today," said Atif Latif, director of trading at Guardian Stockbrokers.

Oil company Afren (L:AFRE), which is in the FTSE 250 mid-cap index (FTSE) rather than the blue-chip FTSE 100, surged 43.4 percent as it continued to rally after Afren's lenders agreed to defer a $50 million (33 million pound) amortisation payment by a month.

However, not all energy companies fared well on Tuesday.

Shares in BG Group (L:BG) edged down after BG wrote $6 billion off the value of its oil and gas business in the fourth quarter.

Another underperformer was Aberdeen Asset Management (L:ADN), which fell 3.6 percent after reporting a small drop in funds under management in the December quarter.

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