Belfast Telegraph

Weak oil price continues to drag down FTSE 100 Index

The London market was rooted in the red on Friday as the blue-chip stocks continued to suffer in response to the weak oil price.

The FTSE 100 Index closed down 15.16 points to 7424.13 despite Brent crude crawling back above the 45 US dollars a barrel mark following a fall in the US dollar.

The greenback sank against a range of currencies after traders questioned the strength of the US economy after updates on the nation's services and manufacturing sectors came in shy of expectations.

Brent crude was up 1% to 45.68 US dollars a barrel, with oil major Royal Dutch Shell B dropping 1p to 2,096.5p and mining giant Antofagasta falling 2.5p to 772p.

David Madden, market analyst at CMC Markets, said: " The energy market has been exceptionally volatile lately, and now that the market is pulling back some of this week's losses the price is certainly steadier.

"Oil has been in a textbook downtrend since the Opec meeting in late May, and that fits in with the wider move lower we have seen since March.

"Selling the rally has proved fruitful in recent weeks and since the same old worries about over-supply persist the bearish sentiment will hang around for some time."

Across Europe, Germany's Dax fell 0.4% and the Cac 40 in France slipped 0.3% despite e conomic activity in the eurozone touching a six-year high in the second quarter.

The closely watched IHS Markit Eurozone purchasing managers' index (PMI) rose to 56.4 for the three months to June, up from 55.6 in the first quarter of 2017.

However, it was countered by eurozone data for this month showing economic activity had come in at its lowest level for five months at 55.7, slipping from a joint six-year peak of 56.8 in May.

Focusing on the currency markets, the pound was enjoying an uplift against the US dollar after America's worse-than-expected economic news sent it 0.4% higher at 1.27.

Sterling was also buoyed by hawkish comments from outgoing Bank of England rate setter Kristin Forbes, who gave a speech late on Thursday saying record-low interest rates are no longer justified.

The UK currency was flat against the euro at 1.136.

In UK stocks, ITV raced ahead after being handed a broker upgrade from JP Morgan to overweight from neutral.

Shares in the broadcaster climbed more than 3%, or 5.9p to 182.8p.

In contrast, BAE Systems slipped 14.5p to 650p after being downgraded by JP Morgan to neutral from overweight.

The biggest risers on the FTSE 100 Index were ITV up 5.9p to 182.8p, Fresnillo up 45p to 1,605p, Ashtead up 39p to 1,620, Old Mutual up 4.2p to 198.4p, Intu Properties up 4.5p to 271.4p

The biggest fallers on the FTSE 100 Index were Smurfit Kappa down 60p to 2,359p, Shire down 107.5p to 4,518.5p, Mediclinic down 17.5p to 757p, BAE Systems down 14.5p to 650p.