More positive trade for European equities BP falls on Rosneft ruling

Friday marked yet another day of gains for European equities with traders continuing to buy into stocks which they feel are good value. There was no standout sector in early trading however, leading European indices higher with gains broadly spread out across energy, banks, construction and pharmaceutical stocks.

On the flip side to the positive equity session thus far was BP shares, which lagged the FTSE 100 Index after an arbitration panel ruled against their partnership with Russian firm Rosneft for oil exploration in the Arctic. The ruling is a bit of a setback for the oil giant which is looking to maximise operations and restore its core brand value after the Gulf of Mexico oil leak last year. BP’s shares have fallen around 0.5% today having rallied as much as 11% from March 15 so it would be hard to conclude that the news has actually knocked shareholder confidence.

The FTSE 100 has seen quite a recovery from the 5600 level when investor fears surrounding the Japanese nuclear situation sent shares in Asia and Europe into a downward spiral. The speed of recovery in stock prices has done much to rejuvenate investor optimism and it has been quite telling that the UK index has not taken long to break through resistance levels on its way higher. Of course, the sharp recovery does open the door for bouts of profit taking but as long as investors perceive share price falls as buying opportunities, the FTSE could make a retest of the 6100 level in the near term.

Profit taking has nudged the share prices of some of the key retailers lower today, having charged higher yesterday on strong results from Kingfisher and Next. Kingfisher and Marks and Spencer’s shares are trading just under 1% lower on the day as a result.

Data out of the US later this afternoon is however likely to keep traders interested. We have the final reading of fourth quarter US GDP, which is expected to be revised higher from 2.8% to 3%. We also have Michigan Consumer Sentiment data due out which always takes a keen traders eye