By Carla Mozee, MarketWatch
LONDON (MarketWatch) -- U.K. stocks rose Monday, moving toward
their first advance in six sessions, as recently beaten-down oil
shares posted modest advances.
The FTSE 100 picked up 0.3% to 6,320.17, on track to halt its
longest losing streak since March. Last week, the benchmark fell
6.6%, marking the worst week since August 2011, according to
FactSet.
The oil and gas group moved 1.6% higher on Monday, paring last
week's drop of more than 3% that came as oil prices fell to
five-year lows.
Ranking at the top of the FTSE 100 were oil producers Tullow Oil
PLC , up 3.7%, and BG Group PLC , higher by 2%. Tullow shares have
declined over past eight sessions, and BG Group has fallen in the
last three sessions, each hit as oil prices have tumbled to
five-year lows on oversupply concerns.
Also, energy-engineering firm Weir Group PLC was up 3.4%, and
shares of oil-services provider Petrofac Ltd. picked up 2%
following last week's 12.9% rout. Among oil majors, Royal Dutch
Shell PLC picked up 1.6%, but BP PLC slipped 0.1%.
Oil prices on Monday were slightly on the mend. U.S. crude-oil
futures (CLF5) were up nearly 1% above $58 a barrel, and Brent
crude futures were up more than 1%, near $63 a barrel. Still,
futures for the commodity are down roughly 40% for the year, and
markets have been wrestling with questions about how low prices
will go.
Commodity firms, particularly oil and gas companies, are
dividend heavyweights in the U.K., accounting for nearly 13% of
payouts across the market, "so if their profits take a battering,
they will find it harder to grow their dividends," said Justin
Cooper, chief executive of shareholder solutions at Capita Asset
Services, in a report Monday. "We would not expect them to cut
payouts in dollar terms, however."
Meanwhile, shares of BT Group PLC were up 0.5% as investors
awaited an announcement on whether EE or rival provider O2 will
land an acquisition bid from BT, which wants to return to the
mobile-services market. EE is a joint venture of Deutsche Telekom
AG and Orange SA , and O2 is owned by Telefonica .
Shares of BT rival Sky PLC were down by 1.9%, leading losses on
the FTSE 100.
Also lower were shares of iron-ore miners BHP Billiton PLC (BHP)
and Rio Tinto PLC (RIO) , down by 0.3% each. BHP was downgraded at
RBC Capital Markets to underperform from sector-perform.
Separately, Australia on Monday projected iron-ore prices will
trade around $60 a metric ton, much lower than its previous
estimate of $92 a metric ton.
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