FTSE nudges higher as Italian stocks fall again

European bourses opened a touch higher this morning with the FTSE 100 trading up 0.1% at 7,695.93 but the index might face headwinds later in the day as Italian stocks started declining again. 

Italy now has a government based on an uneasy coalition that is far from stable and yet will have to decide on issues like the country’s budget which will have implications on the rest of the eurozone.

Oil prices dip to 2-month low

US crude oil prices fell to their lowest level in nearly two months overnight after Donald Trump asked Saudi Arabia to start pumping more oil to stem rising oil prices. 

Although US crude prices continue to be almost $10 below the Brent crude prices in Europe their inexorable rise this year is still being felt by American consumers not only in the form of fuel costs but also in higher costs of all petroleum based products from heating oil to plastics, affecting their overall spending and available cash.

The overnight dip in the oil price was somewhat tempered by US industry data showing a decline in US crude inventories of 2 million barrels against expectations for a slightly smaller decline. 

Even before Trump’s request to Saudi Arabia the country had already discussed increasing production with Russia and a decision is expected to be formalised at the next OPEC meeting in Vienna on 22 June.

WH Smith shares up nearly 6% after results

British retailer WH Smith is in the process of expanding from its core business of selling books, newspapers and chewing gum on the high street and in train stations to branching out into the travel industry, a move that is proving very lucrative at a time when high street sales are declining. 

The company reported that like-for-like sales in its high street stores declined by 1% in the last three months compared with the same period a year earlier. However, WH Smiths sales in the travel division rose 8% year-on-year as the company channelled more investment from its high street shops into service stations and airports. 

Against the background of high street retailers having to close shops to keep their businesses in the black WH Smiths is planning on opening between 15 and 20 new sites in the UK this year.