Oil stocks stop FTSE slip

Heavyweight oil and financial stocks pushed forward today to help the FTSE 100 Index end an eight-day losing streak.

A tentatively upbeat start on Wall Street further lifted trading, with the Dow Jones Industrial Average and tech-laden Nasdaq both up by London’s close.

That contradicted traders’ forecasts of a flat opening and helped spur on the FTSE 100 to close 49.9 points ahead at 3974.9.

Following a strong November, the FTSE 100 has been stuck in a downbeat lull and today’s gains were welcomed by investors.

Heavyweights stocks supporting trading included oil giants, which moved up on hopes Thursday’s OPEC meeting would curb output levels.

That would buoy the price of crude, as would potential supply problems in Venezuela, and BP and Shell added 5p at 419p and 3.25p at 396.26p respectively.

Among financial stocks, Alliance & Leicester set the tone with a climb of 12p to 778.5p on an upbeat trading update.

The sector has taken a battering over recent weeks, predominately on bad debt worries and weak updates from Barclays and Lloyds TSB.

Lloyds lost early gains to close 2.5p lower to 463.5p but Barclays was ahead a penny at 391.75p, Standard Chartered added 26p at 740.5p and Royal Bank of Scotland was up 42p at 1520p.

Fund manager Schroders gained 18.5p at 516.5p while insurer Royal & Sun Alliance added 7.75p at 133.5p.

Elsewhere B&Q-to-Comet group Kingfisher rose 10.25p at 217p after an update showed strong DIY sales had helped offset weaker demand for electrical goods.

Kingfisher is aiming to demerge its electrical interests, including UK-based Comet and Darty in France.

Other retailers gaining ground were fashion chain Next, up 20.5p at 797.5p, and supermarket group Safeway, which was 5.25p higher at 209p.

Water group Severn Trent also gained, up 27.5p at 659p. Half-year results met the top end of analyst expectations and the group further pleased the City by quashing market speculation it was considering cutting dividend payouts.

But the biggest riser was Cable & Wireless, which gained nearly 9% as the hard-hit telecoms group prepared for life outside the FTSE 100.

Shares have taken a battering in recent weeks, with trading depressed by plans for a costly restructuring and a potential £1.5 billion tax liability.

It means C&W will leave the top flight following the FTSE reshuffle but today the stock added 3.5p at 44.5p.

Of the two other companies being kicked out, steel group Corus was flat at 26.75p and industrial services firm Brambles inched up 0.75p at 142.25p.

British Airways is one of the stocks taking their place, after itself being demoted in the last quarterly reshuffle. Today it added 0.25p at 158.5p.

The biggest blue-chip risers were Cable & Wireless, up 3.5p at 44.5p, Royal & Sun Alliance, up 7.75p at 133.5p, Kingfisher, up 10.25p at 217p and Reuters, up 9p at 210p.

The heaviest fallers were BAE Systems, off 32.5p at 131p, Abbey National, off 23p at 548p, Wolseley, off 13p at 517p and Gallaher, off 8p at 593p.