Oil stocks add to FTSE 100 pressure, banks steady
Heavyweight oil stocks kept the FTSE 100 index in the red today as the fallout from Silicon Valley Bank’s collapse continued.
The pressure on shares in BP and Shell came as oil prices slipped on fears that banking stress will mean tighter lending conditions and a further drag on the global economy.
The hard landing jitters left Brent Crude futures down by more than 2%, below the $80 threshold for the first time since early February at $78.87 a barrel.
BP and Shell shares dropped 1.5%, off 8p and 35.5p to 514.5p and 2402.5p respectively, as the FTSE 100 weakened another 0.5% on top of the 2.6% slump seen during Monday’s worst session since last summer.
The latest decline of 40.25 points to 7508.38 now means the top flight is only 50 points above where it started the year, having traded above 8000 as recently as last month.
Top banking stocks including Barclays and HSBC have lost around 10% of their value since Thursday night, but the sector at least showed signs of resilience today.
Asia-focused lender Standard Chartered lost another 2% or 16.2p to 672.6p but NatWest, Lloyds Banking Group and Barclays were within sight of their opening marks.
Signs that the Silicon Valley crisis will deter central banks from hiking interest rates much further meant property stocks dominated the FTSE 100 risers board, led by a 2% or 12.8p gain to 630.6p for Piccadilly Lights owner Land Securities.
British Land and warehouse business Segro also rallied by more than 1%, up 5p to 409.6p and 12.8p to 630.6p respectively.
Elsewhere in the top flight, Rolls-Royce shares returned to the front foot with a gain of 2% or 3p to 148p and US sports betting business Flutter Entertainment lifted 115p to 13,840p thanks to Berenberg’s “buy” recommendation and new 16,000p target.
The FTSE 250 index lost another 40.05 points at 18,785.03, with fallers including Tullow Oil and Harbour Energy after declines of 3%.
Among smaller companies, the rally for Costain shares continued as the infrastructure firm revealed a big improvement in its cash position and said it had already secured around 80% of expected revenues for 2023. The All-Share stock rose 3.65p to 48.2p.
