MARKET REPORT: Middle East tensions fuel gold and oil rush
Investors rushed into oil stocks and safe haven assets after US strikes on Iran-linked targets in Syria.
Easing tensions in the Middle East and supply concerns pushed the price of Brent Crude up 2.4 percent to above $90 a barrel.
It came as the US carried out airstrikes on two weapons and storage facilities in eastern Syria in response to attacks on its own bases by targets linked to Iran’s Revolutionary Guards.
Israel has also increased its military presence in Gaza ahead of an expected ground invasion against Hamas.
Shares in BP fell 0.6 percent, or 3.3p, to 530.5p, while Shell rose 0.5 percent, or 12p, to 2,700.5p and Harbor Energy rose 1.3 percent, or 3.2p , to 253.5p.
On the rise: The prospect of a full-scale conflict in the Middle East also drove investors to safe haven stocks in London
But across the Atlantic, US giants ExxonMobil and Chevron sank into the red after both reported third-quarter profits that were lower than analysts expected. The pair’s results were fresh off recent blockbuster deals. Exxon Mobil, America’s largest oil company, this month agreed to acquire Pioneer Natural Resources for £54 billion. And on Monday, Chevron sealed a £43 billion takeover of rival Hess.
The prospect of a full-scale conflict in the Middle East also drove investors to London as a safe haven.
Higher gold prices sent Fresnillo up 3 percent, or 15.8p, to 549.6p, while Endeavor Mining added 0.4 percent, or 7p, to 1659p and Centamin rose 2.2 percent, or 1.8p, to 79 ,9p.
The FTSE 100 fell 0.86 percent, or 63.29 points, to 7291.28, while the FTSE 250 rose 0.5 percent, or 83.14 points, to 16866.23. London’s second-tier index has recorded its sixth weekly decline – a feat not seen since 2018. Standard Chartered came under further pressure when three City brokers cut their target prices on the lender’s shares, a day after it revealed its exposure to Chinese property. market and a sharp decline in profits.
The shares, which fell 12.4 per cent on Thursday, fell a further 2.3 per cent, or 14.6p, to 610.6p.
Over the past two days, things have gone from bad to worse for Safestyle.
On Thursday, the double glazing giant crashed by an astonishing 80 percent after warning investors could be wiped out if it is sold. And today it was forced to suspend its shares (at 0.32p) due to the company’s increased financial uncertainty.
Subsequently, Safestyle said in a statement after the market closed that it plans to appoint administrators after concluding it was no longer able to continue trading as a going concern. It came as the company said parties interested in buying the company have walked away. Digital 9 Infrastructure rose the highest among mid-cap stocks after the company, which invests in data centers and wireless networks, said it is considering selling its stake in Verne Global.
It is part of the group’s plan to strengthen its balance sheet and deliver better returns for shareholders. Shares rose 10.1 percent, or 3.7p, to 40.2p.
Trainline also led the way when the city backed the online ticketing app to manage the impact of potential UK rail reforms.
Analysts at JP Morgan said it could take several years for Great British Rail, the proposed government-owned company, to be rolled out.
That means commuters are unlikely to switch from Trainline, which has almost two-thirds of the UK’s online ticket market and should continue to grow.
JP Morgan upgraded its rating on the online ticketing app from ‘neutral’ to ‘overweight’ and raised its target price from 295p to 300p. Shares rose 9.5 percent, or 22p, to 253.2p.