By Carla Mozee, MarketWatch
Lloyds rises, Tullow Oil exits FTSE 100 on a high note
LONDON (MarketWatch) -- The U.K.'s benchmark FTSE 100 leapt to
its highest level on Friday, powered by mining stocks and energy
shares, including Tullow Oil PLC, as it moved out of the blue-chip
index.
The FTSE 100 climbed 0.9% to 7,022.51, the first time it's
crossed above the 7,000 level. The gain pushed the benchmark to a
weekly gain of 4.2%, its best weekly rise in about two months.
A decline in the U.S. dollar (DXY) fueled gains for
dollar-denominated oil and metals prices, in turn boosting shares
of energy and mining companies. In the energy complex, U.S. oil
futures
(http://www.marketwatch.com/story/oil-prices-stay-choppy-ahead-of-rig-count-data-2015-03-20)(CLJ5)
climbed 5% and Brent crude futures rose more than 1%. The dollar
resumed its selloff Friday
(http://www.marketwatch.com/story/dollar-steadies-on-renewed-views-of-early-fed-rate-increase-2015-03-20-21031353)
on expectations that Federal Reserve policy makers would leave
interest rates lower for longer.
Miner Anglo American PLC was the best performer on the FTSE 100
as its shares rose 5.2%. Glencore PLC ended 4.7%, while oil major
BP PLC rose 2.3%.
Tullow Oil: Tullow shares climbed 3.5% after the oil producer
said it landed an extra $450 million in financing under its
existing credit facilities. The additional funding came despite the
recent slump in oil prices, said Tullow.
The funding marks "a rare piece of good news to help continue to
lift the shares away from their recent bottoming out earlier this
week around [GBP2.80]," wrote Lewis Sturdy, dealer at London
Capital Group, in a note.
The recent slide in oil prices contributed to a drop in Tullow's
market capitalization below what's required to stay on the FTSE
100. Tullow shares on Monday will be found on the midcap FTSE 250
index .
Hikma Pharmaceuticals PLC shares will begin trading on the FTSE
100 on Monday. Its shares on Friday fell 3.4%.
Deal moves: Lloyds shares rose 1.4% after TSB Banking Group
agreed to a GBP1.7 billion ($2.54 billion) takeover bid
(http://www.marketwatch.com/story/sabadell-agrees-to-254-billion-takeover-of-tsb-2015-03-20)
from Spain's Banco de Sabadell SA . Lloyds is the largest
shareholder in TSB, and would still have a 40% stake in that
company if a deal is approved.
TSB shares rose 2.1% to GBP3.34 on the FTSE 250 index .
Sabadell's offer was for GBP3.40 a share.
Sabadell's offer appears "very likely" to be accepted by the
majority of shareholders, but risk remains the European financial
regulator or the U.K.'s Prudential Regulation Authority blocks the
deal, said Hargreaves Lansdown analyst Laith Khalaf and Richard
Hunter in a note Friday. "This risk looks remote, but the market is
clearly still wary, which explains why the [TSB's] stock is trading
as far below the offer price as it is."
Meanwhile, the apparent revival of a merger agreement between
cement companies Lafarge SA and Holcim Ltd. aided London-listed
shares of CRH . CRH shares gained 5.6% after Lafarge (LFRGY) and
Holcim (HCMLY) drafted new terms for their $44 billion merger
proposal
(http://www.marketwatch.com/story/holcim-lafarge-agree-new-terms-for-44-billion-merger-deal-2015-03-20),
which had recently appeared to be on the verge of collapse. CRH had
planned to purchase assets from the French and the Swiss companies
as part of their merger proposal.
The FTSE 100's decliners on Friday included Centrica PLC .
Shares fell 0.3% after Moody's Investors Service downgraded its
rating on British Gas' parent company to Baa 1 from A3. The move
came "primarily because lower energy prices and generally poorer
trading conditions have hurt the company's profitability and
weakened its financial profile," said Moody's.
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