Rare rise for BP has FTSE in the black

BP kept the FTSE 100 Index in positive territory today after shares jumped 7% on takeover and deal speculation involving the beleaguered oil major.

BP kept the FTSE 100 Index in positive territory today after shares jumped 7% on takeover and deal speculation involving the beleaguered oil major.

Reports at the weekend suggested that Exxon, the world’s biggest company, had sought clearance from the White House for a move that could create a firm with a stock market value of more than £265bn (€316.43bn).

BP was also said to be in talks with US oil company Apache over the sale of some of its assets.

In a lacklustre start to the week for the FTSE 100 Index – up 4.2 points at 5137.3 – BP shares jumped 25.3p to 390.1p, leaving the stock at the highest level for almost a month.

The rise came as BP said that its latest efforts to contain the Gulf of Mexico oil spill were on track, although it has cost the firm $3.5bn (€2.78bn) since the crisis began 84 days ago.

BP took centre stage in a light session for corporate news – a trend that is likely to continue on Wall Street as the Dow Jones Industrial Average is poised to start off around 55 points lower than Friday’s close.

Elsewhere, BT shares lost some of the gains seen before the weekend after it reached a deal with union leaders for an “unprecedented” three-year pay rise worth more than 9%. Shares were 2.1p lower at 137.9p.

Outside the top flight, shares in construction group Kier were 6% higher, up 49p to 992p, after it flagged annual profits at the top end of market hopes.

The firm said it had secured high volumes of work and added that previously mothballed private commercial projects were being resurrected.

Meanwhile, shares in Domino’s Pizza failed to hold on to an initial gain seen after it posted a better-than-expected 28% rise in half-year profits to £17.5m (€20.9m).

Like-for-like sales were up 17.2% in the second quarter, but analysts focused on tougher prospects for the second half of the year as shares dropped 5.4p to 397.6p.

It was a mixed session for South West Trains operator Stagecoach due to a contrasting assessment of its prospects from two City brokers.

JP Morgan Cazenove upgraded the stock on the hope of a significant return of capital to shareholders, but Royal Bank of Scotland was more cautious and downgraded the company to sell from hold as it said it feared that Stagecoach’s exposure to government spending cuts will come into focus.

Shares were down 3p at 181.4p.

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