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London open: Stocks slide as trading volumes thin on NYE
London stocks opened in the red on Thursday as trading volumes were thin on New Year’s Eve.
The UK equity market will close at 1230 GMT to bring in 2016 and will reopen on Monday. Germany and France are both closed for the day while the US will have normal trading hours.
Oil prices will be in focus again after a decline sent equities lower in the previous session. Concerns about an oversupply in the sector grew after data showed an unexpected rise in crude inventories. The US Department of Energy’s statistical arm said in the week ending 25 December, stockpiles of commercial US crude oil rose by 2.6m barrels from the previous week to 487.4m. Analysts had been expecting a drop of 1m barrels.
“A continued slide in the oil price and a US Dollar that’s not going down without a fight are dominating sentiment as people begin to attempt their 2016 forecasts, seeing headwinds for long term earnings,” said Augustin Eden at Accendo Markets.
Oil recovered slightly in morning trade. At 0837 GMT, Brent crude rose 0.5% to $36.65 per barrel and West Texas Intermediate increased 0.3% to $36.71 per barrel.
On Thursday’s agenda there is little in the way of economic data apart from the US initial jobless claims report out in afternoon trade.
On the company front it is also quiet with no results from any of the FTSE 350 companies.
Sports Direct declined after saying that it will pay its staff the above the national minimum wage, which will cost the company about £10m for the year.
Royal Dutch Shell slid as it said it started production at the Corrib gas field, which is located 83 kilometres off Ireland’s northwest coast, almost 20 years after the reserves were discovered.
Ocado continued to fall on news that Amazon was expanding its UK grocery delivery service.
Vodafone rallied on reports that it was in talks about a merger with US-listed cable company Liberty Global.
