Oil price falls fail to dent market optimism

Markets started the week quietly on Monday as the holiday season saw traders switch off their terminals and enjoy the summer weather.

With economic news is short supply, it was the commodity markets that provided the briefest glimpses of excitement on trading floors, with oil taking a hit over Covid-19 fears.

A barrel of Brent Crude fell on Monday 2.5% to 68.92 dollars as markets closed, denting the likes of BP and Shell in the process.

But despite the wobbles in some commodity big hitters, the FTSE 100 managed to close the day up 9.35 points, or 0.13%, at 7132.3.

The French CAC closed down 0.1% and the German DAX lost 0.1%.

The pound was flat against the euro and the dollar at 1.174 and 1.385 respectively.

Chris Beauchamp, chief market analyst at IG, said: “While precious metals prices have rebounded today, oil remains under pressure, but while there might well be some Delta variant fears driving the move, the fact that equities have remained broadly calm points towards an odd disconnect; either equities are blithely ignoring a major worry, or oil prices are undergoing a self-contained selloff that is being driven chiefly by supply concerns.”

There was more action in company news with energy firm SSE topping the biggest risers on the FTSE 100.

Rumours abound that the company could be in line for a bid from private equity house Elliot Management, leaving shares up 77.5p, or 5%, at 1,623.5p.

Elsewhere, shareholders in Morrisons now have an extra week to see if another PE house, CD&R, decides to make a last-minute bid for the supermarket.

The Takeover Panel has extended the “put up or shut up” deadline until next Monday to see if Fortress’s current £6.7 billion bid – or 270p a share – can be topped before voted on by shareholders.

Investors seem to think a bid could be coming, with shares closing flat at 278.8p – above Fortress’s bid.

Separately, the Panel also said a takeover battle for inhaler-maker Vectura, would go to an auction starting on Tuesday after tobacco maker Philip Morris and PE firm Carlyle both made bids.

The board has faced criticism for accepting a bid from the maker of Marlboro cigarettes for a business that aims to help respiratory disease.

But shareholders were pleased that a bidding war was developing, with shares closing up 9p, or 5.5%, at 173p.

Elsewhere, fund manager Hargreaves Lansdown said it attracted a record number of new customers last year as younger investors searched for places to keep their money.

But the company missed profit expectations in the City, sending shares down 186p to 1,454.5p – making it the biggest faller on the FTSE 100.

Vodafone announced it would be the latest mobile network to reintroduce roaming charges for Britons who travel to other countries in Europe.

Shareholders seemed pleased with the prospect of extra cash coming in, with shares closing up 0.72p at 119.38p.

Food delivery app Deliveroo enjoyed a jump in its share price by 14.7p, or 4.5%, to 339.8p as the company revealed rival Delivery Hero has snapped up a 5% stake in the business.

And Domino’s Pizza completed the sale of its Swiss business as part of plans to offload loss-making divisions and focus more on its UK and Ireland operations. Shares closed down 2.6p at 419.6p.

The biggest risers on the FTSE 100 were SSE up 77.5p at 1,623.5p; Scottish Mortgages up 36p at 1,375p; Flutter up 220p at 12,940p; Ashtead up 70p at 5,510p and Next up 98p at 8,072p.

The biggest fallers were Hargreaves Lansdown down 186p at 1,454.5p; IAG down 5.72p at 167.72p; Rolls-Royce down 3.34p at 109.08p; Weir down 46p at 1,640p and British Land down 11.4p at 515.8p.