LONDON MARKETS: FTSE 100 Wobbles With OPEC Decision In Sight
May 25 2017 - 4:25AM
Dow Jones News
By Carla Mozee, MarketWatch
U.K. stocks dipped Thursday, with oil shares moving lower ahead
of a production decision from the Organization of the Petroleum
Exporting Countries.
The FTSE 100 was down 3.2 point at 7,511.90 as energy, tech and
telecom shares declined. The utilities sector, considered a
defensive one, and financials were moving higher. The index on
Wednesday flipped higher to close up by 0.4%
(http://www.marketwatch.com/story/mining-retail-shares-tug-ftse-100-slightly-into-the-red-2017-05-24).
The oil industry will be in focus Thursday as OPEC is expected
to announce its highly anticipated decision on whether to extend
production cuts. Cuts were initially put in place in November as a
way to tackle global oversupply.
Read:4 potential outcomes for OPEC's crucial meeting
(http://www.marketwatch.com/story/4-potential-outcomes-for-opecs-crucial-meeting-2017-05-19)
Oil prices have climbed in anticipation that a group OPEC and
non-cartel members will continue pumping oil at reduced levels.
West Texas Intermediate and Brent crude were up about 1%.
But shares of oil producer BP PLC (BP.LN) (BP.LN) fell 0.7% and
rival Royal Dutch Shell PLC (RDSB.LN) (RDSB.LN) lost 0.3%. The
energy group has a roughly 14% weighting on the FTSE 100.
"OPEC is notorious for failing to deliver, so it'll be touch and
go to see if a deal is reached," said Connor Campbell, financial
analyst at Spreadex, in an note. He added that "the market may also
be reliant on dribs and drabs of information rather than anything
substantial," as the decision isn't expected to arrive before 4
p.m. London time, or 11 a.m. Eastern Time.
Investors were also watching the pound , which was
re-approaching the $1.30 level as the dollar was broadly lower
against major rivals. A stronger sterling can hurt the FTSE as
about 75% of the revenues for the index's companies are generated
overseas.
The dollar was choppy late Wednesday after minutes from the
Federal Reserve's latest policy-setting meeting showed policy
makers appeared set to start shrinking the bank's massive balance
sheet.
The minutes also showed that most Fed officials said it would
"soon" be time to raise rates again.
Read:Seeing another rate hike 'soon,' Fed outlines plan to
reduce bond holdings, minutes show
(http://www.marketwatch.com/story/seeing-another-rate-hike-soon-fed-outlines-plan-to-reduce-bond-holdings-minutes-show-2017-05-24)
Meanwhile, a second reading of first-quarter gross domestic
product for the U.K. is due at 9:30 a.m. London time, or 4:30 a.m.
Eastern time, as are March figures for services activity.
(END) Dow Jones Newswires
May 25, 2017 04:10 ET (08:10 GMT)
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