London afternoon: Oil lubricates slippery slope

23rd Feb 2011 14:22

An attempted rally in the morning was already fizzling out as the afternoon started, and prices continued to drift lower over the lunchtime trading session, as investors continue to fret about the higher oil price.Brent crude for April delivery surged to more than $109 per barrel shortly after 2pm, though it has dipped down below $109 again since then. The $3+ rise has been prompted by strong demand as the violence and rhetoric in Libya increased. Libyan leader Muammar Qaddafi vowed to fight a growing rebellion until his "last drop of blood." Brent is now at its highest level since September 2008.British Airways owner IAG, and cruise operator Carnival are again feeling the pinch of the higher oil price. Easyjet is also lower.British Gas owner Centrica underlined the importance of the Middle East for British interests today with the announcement that it has signed a £2bn deal with Qatar to secure enough liquefied natural gas (LNG) to meet 10% of household gas demands. The company issues full year figures tomorrow.A New York judge has thrown out an attempt to sue Barclays for $11bn (£6.8bn) over the way it bought Lehman Brothers at the height of the credit crunch.Consumer packaging giant Rexam falls back even after it grew underlying profit by a bigger than expected 45% in 2010 and expects further progress this year. Profit before tax and exceptional items jumped to £412m from £285m in 2009 on sales up 2% to £4.96bn. Net asset value per share surged 15% to 390p from 339p a year earlier at Capital Shopping Centres while net rental income improved by 4%, or 2% on a life for like basis, in 2010 to £277m from £267m in 2009.Elsewhere in property, Capital & Counties, the central London-focused property group, is higher after it confirmed that it has received expressions of interest about a possible joint venture to redevelop the Earls Court exhibition centre. A report in the Financial Times this morning said that Capital is in talks with the Kwok family, which controls Hong Kong's largest listed property developer Sung Kai Properties over funding for the redevelopment.Cable & Wireless Communications has stormed ahead after saying it has sold its operating business in Bermuda to The Bragg Group for total consideration of $70m. CWC will also buy back $100m worth of shares. Profits jumped by a fifth last year at builders' merchant and DIY shed group Wickes owner Travis Perkins as all 11 of its businesses performed better than the market, though merchanting was the star. Group revenue rose by 8% at £3.2bn, and 5% higher on a like-for-like basis. Adjusted profit before tax up 20% to £217m, though including exceptional charges profits fell from £213m to £197m.Revenues picked up in the fourth quarter to enable software group Logica to recover some ground lost earlier, though sales and profits overall still came in flat last year. Full year 2010 revenue rose by 1% pro forma to £3.7bn, with fourth quarter sales up 4%. Profits were unchanged over the previous year at £272m, though the dividend rises by 27% to 4.2p.Insurance sector consolidator Resolution is lower today even after saying it is confident it can achieve its targeted mid-teen returns without further acquisitions, though it hasn't ruled them out. The firm, set up by entrepreneur Clive Cowdery, won't contemplate purchases that would dilute the returns likely to emerge from the three acquisitions already made. Housebuilder Galliford Try has been encouraged by sales in the first few weeks of 2011, while the end of 2010 was not so bad either. The company declared a 29% improvement in underlying pre-tax profit to £17.0m for the six months to 31 December 2010, from £13.2m the year before (2009: £6.4m after exceptional charges).Optical components maker Gooch & Housego said its financial year has started positively with trading ahead of management expectations in the first four months. The group said it had experienced strong demand for its products across all of its sectors.