UK stocks fell, paced by British Airways Plc and Carnival Plc as oil climbed for a seventh day in New York. BP Plc and Drax Group Plc led advancing shares.
Standard Life Plc and Scottish & Newcastle Plc pulled the FTSE 100 Index lower as the shares began trading without the right to their latest dividend. Next Plc rallied for a second day on takeover speculation.
The benchmark FTSE 100 lost 1.8, or less than 0.1%, to 6290.80 in London at 12:57 pm. The FTSE All-Share Index lost 0.1% to 3,270.11. Ireland’s ISEQ Index fell 84.02 to 9,294.62.
British Airways, Europe’s third-largest airline, slid 1.3% to 490.5 pence. Carnival Corp., the world’s largest cruise-ship company, fell 1.5% to 2,420 pence.
Crude oil for May delivery gained 2.4% to $64.46 a barrel in after-hours trading in New York on concern a dispute over Iran’s detention of British servicemen could escalate, disrupting supplies from the Middle East.The oil price makes up 30% of total costs for airlines and 15% for shipping, according to Credit Suisse research.
BP, Europe’s second-largest oil company, gained 2% to 554.5 pence. Shell, the region’s largest oil company, rose 1.5% to 1,709 pence. The company said chief executive officer Jeroen van der Veer will continue in the position until 30 June 2009.
Drax Group Plc, the owner of the UK’s biggest power plant, paced utilities higher, climbing 2.9% to 788 pence. British Energy Group Plc, the UK’s nuclear-power generator, rallied 4% to 473 pence.
“It’s a pure oil-price reaction,” Ian Mitchell, a London- based analyst at JPMorgan Securities Ltd, said by phone. “The general assumption is if oil prices go up, gas prices increase and prices go up for electricity, which is the key revenue-driver for these companies.”
Standard Life, a U.K. insurer, lost 1.5% to 306 pence, one of six companies in the FTSE 100 to trade without the right to the latest dividends.
Scottish & Newcastle declined 3.4% to 528 as its shares trade without the right to a final dividend of 14.44 pence. British Sky Broadcasting Plc, Capita Group Plc, Smith Group Plc and Wolseley Plc are also trading ex-dividend.
Next climbed 4.3% to 2,400 pence, extending yesterday’s 3.3% gain. The shares rose on speculation the UK’s third-largest clothing retailer may receive a takeover bid of 2,500 pence a share.
“Bid rumours have been swirling around Next,” Richard Ratner, an analyst at Seymour Pierce in London, said in a note published on 27 March after UK share trading had ended. “It has been mooted that the management team is behind the rumoured offer.”
Next spokesman Alistair Mackinnon-Musson declined to comment when contacted on 27 March.