Sector movers: US data lifts oil stocks, Just Eat drags retailers

London stocks on Wednesday continued to regain ground lost at the start of the week, with oil related stocks leading the charge on the back of helpful industry data.

Oil prices surged yet higher on Wednesday afternoon, with Brent crude up 1.4% to $77.7 as EIA confirmed indications overnight from the API of that oil stockpiles in the US was falling sharply.

The US Energy Information Administration reported a fall of 9.89m barrels in oil inventories in the week to 22 June. Market analysts' had expected a drawdown of just 2.57m barrels, following an American Petroleum Institute report of a 9.13m decline.

Shares in oil majors BP and Shell were both given further boost, having already been on the front foot after the API data, while oil services companies John Wood Group, Hunting and Petrofac rose even more sharply.

Analyst Craig Erlam at Oanda said: "Oil is continuing to climb in European trade after a US state department official claimed they are pushing allies to cut oil imports from Iran to zero. This comes at a time when supply disruptions in some countries including Venezuela are already weighing on output. Last week, OPEC and some non-OPEC producers that participated in the 1.8 million barrel a day output cut in recent years agreed to pump an extra million barrels a day, something traders appear to feel will be difficult to achieve."

On the downside, general retailers was the main laggard despite a pretty positive report from the CBI, which showed retail sales surging more than expected this month. Retailers reported an average sales jumped to a balance of +32 in June, the CBI's distributive trade survey found, up from May's +11 to the highest level since September and better than the market's expectation for a balance of +10. Department stores, durable household goods, grocers and hardware stores fared well, while carpet and furniture stores and clothing retailers saw a drop in sales volumes.

Just Eat was the biggest faller, with its shares beginning to tumble just after 1400 BST on the back of reports of a less-than-encouraging outlook at the company's capital markets day, specifically with there being a lack of 2018 guidance. Trading had to be halted temporarily after a 10% fall. The CMD is the first time that new CEO Peter Plumb has outlined his full strategy for the next few years to investors and analysts, with a number of Just Eat executives and country managers also talking about the current operations. A press release from the company said there will be no update on trading.

There was news from Just Eat of a delivery trial with US giant chain Subway, with an initial roll-out in London, Leeds and Manchester and plans to extend the delivery service to over 500 Subway stores nationwide by the end of 2018.

Dixons Carphone was down for a second day after analysts at Credit Suisse said the company needed to cut even more sharply than planned to arrest a decline in its “barely profitable” mobiles business. Next and Dunelm were lower, Marks & Spencer and JD Sports were higher. JD was lifted as broker Peel Hunt highlighted material upside potential from the sports and fashion retailer following its "transformational" acquisition of US group Finish Line.

Top performing sectors so far today

Oil Equipment, Services & Distribution +3.07%
Oil & Gas Producers +2.97%
Aerospace and Defence +2.06%
Software & Computer Services +1.92%
Leisure Goods +1.85%

Bottom performing sectors so far today

Automobiles & Parts -3.08%
General Retailers -0.95%
Real Estate Investment & Services -0.56%
Industrial Transportation -0.39%
Insurance (non-life) -0.33%