Sector movers: Dividends in focus as Shell leaps higher

Big Oil paced gains after Royal Dutch Shell said it would re-start its cash payouts from the fourth quarter of 2017.

Shares jumped back towards their 52-week highs as management said new projects were still on track to deliver 1.0m barrels of oil equivalent per day and $10bn of cash flow by 2018 and were expected to deliver an incremental $5bn cash flow from operations by 2020.

In the background, front month Brent crude oil futures were little changed, trading 0.55% lower on the day to $63.49 a barrel on the ICE.

As of the Tuesday close the dividend yield on offer for investors in Shell was an unusually lofty 6.03%.

Acting as a backdrop, traders were playing it safe ahead of the Organisation of Petroleum Exporting Countries's 30 November ministerial meeting at which the cartel was expected to announce an extension of its output curbs until the end of 2018.

However, Russia was said to still be unconvinced, due to the risk that sustained high oil quotes would only serve to feed its US shale rivals.

Earlier on Tuesday, an OPEC technical committee had recommended such an extension.

Shell wasn't the only high dividend yielding stock in play, with investors also seeking out the likes of Diageo and other defensives names such as Unilever.

Food retailers were also in demand as shares of Ocado staged a sharp bounce after announcing it had inked a deal with Groupe Casino to develop the Ocado Smart Platform in France.

"We see this deal, with a major international partner, as significant in its own right and a huge validation of Ocado's model and IP. Indeed, the comments of Groupe Casino and Monoprix management represent a clear endorsement.

"We continue to believe that Ocado is developing the most advanced and economic end-to-end platform for third party retailers, a view validated by this deal, and expect it to sign multiple deals in the coming years," analysts at Numis said as they stuck by their 400p target and 'buy' recommendation on the stock.

On a related note, Citi's Eli Krieger picked-up on a reports in Sweden's www.markets.se according to which the country's main grocer, ICA, may sign-up to Ocado's Smart platform too "at the beginning of [2018]".

Top performing sectors so far today

Oil & Gas Producers 8,749.20 +3.14%
Forestry & Paper 19,377.67 +2.92%
Food & Drug Retailers 3,062.98 +2.10%
Personal Goods 37,594.41 +1.75%
Beverages 21,154.65 +1.55%

Bottom performing sectors so far today
Mining 17,098.66 -0.91%
Real Estate Investment Trusts 2,906.56 -0.21%
Oil Equipment, Services & Distribution 13,012.94 -0.16%
Health Care Equipment & Services 7,456.88 -0.11%
Real Estate Investment & Services 2,703.76 -0.10%