THURSDAY MARKET CLOSE: Energy in the spotlight amid job cuts

Royal Dutch Shell CEO Ben van Beurden delivering the company's Q2 results. Picture: PA
Royal Dutch Shell CEO Ben van Beurden delivering the company's Q2 results. Picture: PA
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Plans for significant redundancies at Royal Dutch Shell and Scottish Gas owner Centrica helped propel energy blue chips into the limelight, while Royal Bank of Scotland made share gains despite the taxpayer-owned bank tumbling into the red at halftime.

Shell was the biggest riser among the top-flight stocks as investors backed its cost-cutting plans to offset plunging oil prices, including 6,500 job losses this year. The oil major lifted 84p or 4.7 per cent to 1,861p despite posting second-quarter results showing a 35 per cent slide in earnings to $3.36 billion (£2.16bn).

The wider FTSE 100 Index closed up 37.87 points at 6,668.87, helped by figures showing the US economy rebounded after a harsh winter in the second quarter with annual growth of 2.3 per cent.

Among the banks, RBS dropped 10.8p or 3 per cent to 342.4p despite figures showing an unexpected second-quarter profit of £293 million, although it fell to an overall bottom-line loss of £153m for the first half.

The state-backed lender warned of more financial pain to come as it edges towards a settlement with the US over allegations it misled investors on mortgage-backed securities sold by the group.

However, analysts said the second-quarter performance set RBS fair for the UK government to begin selling down the taxpayer stake from this autumn, even if this means a loss to the £5 state buy-in price.

Elsewhere, InterContinental Hotels leapt 4.6 per cent, or 120p, to 2,743p after a report of deal talks being held with US rival Starwood. However, the company issued a statement to say the two firms were not in discussions over a combination of the businesses.

Centrica was on the list of share losers, down 8.6p or 3.1 per cent at 266.6p as it announced plans to cut 6,000 jobs.