Market report: Thursday close

By Mickey Clark for MailOnline
Updated: 10:59 EDT, 7 January 2008

Oil shares have been ticking better on both sides of the Atlantic this week as crude prices nudged towards $100 a barrel ahead of the latest US energy reserves numbers.

Overnight on Wall Street, oil shares were marked higher, and that buying spilled over into Asian markets this morning.

Last week's update from America's Department of Energy revealed US crude oil stocks had fallen below their five-year average for the first time in more than three years, heightening supply concerns.

Prices surged after Turkey launched air raids against Kurdish rebels in northern Iraq, which again raised worries about the geopolitical situation in the oil-rich Middle East.

BG Group rose 28p to 1141p and Royal Dutch Shell 31p to 2112p. But Cairn Energy led blue-chips higher with a jump of 169p to 2994p. Dana Petroleum was up 39p to 1399p and Soco International 47p to 2197p.

Shares generally ticked better in London as some investors made their way back to work instead of heading for the High Street sales. The FTSE 100 index rose 16.4 points to 6495.7 in predictably thin trading, around 600 million shares had changed hands by mid-afternoon.

After a record breaking run, Unilever shares slipped 10p to 1909p. Shares in the Lipton tea-to-Knorr soup group have enjoyed a phenomenal run this year, surging from a low of 1344p. Professional and private investors continue to view the food supplier as a defensive play in turbulent markets.

Footsie 100 newcomer TUI Travel gained 4½p to 296¼p. Life assurer Old Mutual, which has been buying back its own shares, put on 1.8p at 171.4p.

Housebuilders turned easier on the back of disappointing mortgage approvals, which are showing a big drop on a year ago. Dealers say it highlights how difficult the housing market has become, and builders will come under further pressure in 2008.

Persimmon fell 5½p to 790½p. Suppliers of building materials also lost ground with Wolseley down 8½p at 739p and Travis Perkins 26p at 1199p.

Gyrus accelerated 24p to a record 620p as more than 11m shares changed hands. Japan's Olympus Corp has been given the all-clear by US regulators to proceed with its bid for Gyrus but a review by competition authorities in two European jurisdictions is still in process. In November, Olympus agreed to buy Gyrus for 630p a share, implying an enterprise value of £1.02bn.

Aim-listed XG Technology, unmoved on $6.12, has extended its territory agreement with Gama Group and its unit, Vegatel, for its xMax commercial applications in Turkey until the end of June 2008. The Florida-based communications technology specialist said Gama has completed due diligence on its core physical layer technology, and both companies are likely to sign a final agreement for exclusivity in Turkey by 30 June.

Rank firmed 1¼p to 91¼p. Speculation on Christmas Eve claimed US rival Harrah's Entertainment had appointed advisers to explore strategic options in Europe.

Polar Investments has sold a million shares in Telit Communications, up ½p at 83p, at 95p each, reducing its stake to 4.86m, or 11.24%.