BP spurs biggest FTSE gains for two weeks
LONDON (Reuters) - The FTSE 100 posted its biggest gain in two weeks on Tuesday after BP's earnings topped forecasts, although volumes were among the lowest this year as U.S. markets stayed shut.
BP shares topped the FTSE 100 gainers, jumping 4.2 percent after the oil giant lifted its dividend and delivered better-than-expected third-quarter earnings.
The index closed up 54.80 points, or 1 percent, at 5,849.90, its biggest one-day percentage gain since October 16 and more than reversing Monday's fall of 0.2 percent.
"Today's been better than yesterday, we seem to have more corporate news today, so we felt like we've been a bit busier," Will Hedden, sales trader at IG Index, said.
"Today we've got more of a sustained move and haven't seen any selling once we got going."
The heavyweight integrated oil and gas sector added 23 points to the FTSE, with miners adding another 8 points. BP alone contributed 13.5 points to the index.
BP's "results were much stronger than we and the market anticipated - almost entirely in refining and marketing where the clean result was $3 billion versus our forecast of $1.8 billion," Investec said in a note.
"It has been an immensely complicated time for BP and this update reflects just how much progress has been made," said Richard Hunter, head of equities at Hargreaves Lansdown Stockbrokers.
Imperial Tobacco shares also gained, rising 1.6 percent after the cigarette group unveiled an 8 percent rise in annual earnings.
Some encouraging earnings reports from the euro zone, including a 20 percent jump in Deutsche Bank's group profit, also helped sentiment.
"BP aside, the FTSE 100 is gaining a shot in the arm ... from a raft of decent corporate numbers in the euro zone," said Mike McCudden, head of derivatives at Interactive Investor.
"However, the catalyst which will propel the market higher from here remains in hiding."
The index rose on low volumes of a mere 55 percent of the 90-day daily average as Sandy - one of the biggest storms on record - battered the U.S. east coast, keeping Wall Street closed for a second day and suppressing trading activity. There were hopes that U.S. stock markets would be able to reopen on Wednesday.
The storm, which was downgraded from hurricane status, was seen benefiting some stocks. Emergency power provider Aggreko gained 1.3 percent, with Seymour Pierce reiterating its "buy" rating, citing upside from the storm.
Insurers, highly exposed to natural disasters, recovered after sharp falls on Monday on hurricane cost worries.
Admiral rose 0.6 percent and the sector gained 0.9 percent.
"At first glance the expected insured losses from look relatively containable," analysts at Oriel Securities said.
On the downside, United Utilities was the biggest faller in the index, losing 2.7 percent, with IG's Hedden citing the "risk-on" mood in the market as bad for utilities.
(Additional reporting by Tricia Wright)
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