Energy and oil companies rally on London stock exchange
|So far in 2022, energy companies have exhibited some of the best performances among London-listed stocks. Energy companies dominated both the FTSE 100 and 350 indices as of July 11, with stocks such as Drax Group (LON: DRX), Centrica (LON: CNA) and Harbour Energy (LON: HBR) logging growth of at least 3.50% in recent trading. Specifically, Drax logged a 8.37% improvement in its price, topping the FTSE 350, while Centrica led the FTSE 100 rally with a growth of 4.07%.
UK recession concerns escalate
A Unicredit analyst note on a July 11 Reuters report stated that "monthly GDP growth and industrial production data are due to be released in the UK on Wednesday and will likely confirm that the worsening of the economy is already on course, as BoE Governor Andrew Bailey already flagged." The note further stated that "bad news on the domestic macro front may drag GBP-USD lower again, making it difficult to hold the 1.20 handle."
However, considering that energy is a constant need regardless of the economic state, the sector and companies playing in it are growing stronger.
Win for London energy companies
Oil and gas companies like Harbour Energy have benefited as heightened demand for both commodities push prices to new heights. In the first quarter of 2022, the per-barrel price of Brent crude rose to $108 from $85. As of July 11, Brent trades at ~$105 per barrel. On the other side of the spectrum, the majority of the 10 worst-performing stocks on both the FTSE 100 and FTSE 350 indices are mining companies. Anglo American (LON: AAL), Fresnillo (LON: FRES) and Endeavour Mining (TSE: EDV) figure among the worst of both indices, joined by a couple of packaging companies.
The mining companies' presence in the worst-performing stocks list come as metal prices underperform. Reuters reported July 11 that reports of fresh COVID-19 curbs in multiple Chinese cities will affect the outlook demand from top metals consumers.
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