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July 7, 2021, 10:29 a.m. EDT

Mining stocks rise in London and Shell in focus after plan to boost shareholder payouts

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By Barbara Kollmeyer

Resource stocks were driving gains for stocks in London on Wednesday as oil prices climbed and Royal Dutch Shell said it would lift its investor payout to shareholders.

The FTSE 100 index /zigman2/quotes/210598409/delayed UK:UKX -0.03% rose 0.4% to 7,130.31, while the British pound /zigman2/quotes/210561263/realtime/sampled GBPUSD +0.2285% fell 0.2% to $1.3772.

International benchmark Brent crude and US. oil prices /zigman2/quotes/211629951/delayed CL.1 -1.37% both fell more than 1%, having risen earlier on Wednesday, as investors continued to watch a standoff between OPEC members over output. Energy stocks surged earlier in the day, though gains pared by the afternoon.

Shares of Shell , were lower in afternoon trading after a sharp gain earlier in the session. The Anglo-Dutch energy company said it would boost shareholder distributions to 20%-30% of cash flow from operations starting from the second-quarter results announcement on July 29.

Strong operational and financial delivery and a more improved economic outlook has helped the company move to the next phase of its capital allocation framework, the company said.

“This news is an interesting coda to the recent court decision in the Hague which effectively forced Shell to reduce its emissions more quickly than planned. This is likely to require significant investment and for this reason Shell is likely to be wary of overstretching itself in terms of dividend commitments,” said AJ Bell investment director Russ Mould.

“The continuing volatility in oil prices means managing an oil and gas business like Shell remains a high-wire act. To put the see-saw nature of the market into context, oil has traded at multi-year lows and more recently at multi-year highs all in less than 18 months,” he told clients in a note.

Mining stocks were leading the gains, with shares of Rio Tinto /zigman2/quotes/208934945/delayed UK:RIO -0.25% /zigman2/quotes/202627887/composite RIO +0.97% up 2.1%, Glencore /zigman2/quotes/201400686/delayed UK:GLEN +0.29% 2.8% higher and Anglo American /zigman2/quotes/201381512/delayed UK:AAL -0.17% climbing 3.7%. Miners gained as metals prices also rose on Wednesday.

Shares of money transfer group Wise climbed 6% to 840 pence following its direct-listing debut on the London Stock Exchange of 994,589,856 shares that saw it open at around 800 pence. That gives the company a valuation of roughly £8.5 billion ($10 billion).

/zigman2/quotes/210598409/delayed
UK : FTSE UK
7,556.23
-2.26 -0.03%
Volume: 517,815
Dec. 2, 2022 4:58p
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/zigman2/quotes/210561263/realtime/sampled
US : Tullett Prebon
1.2284
+0.0028 +0.2285%
Volume: 0.0000
Dec. 2, 2022 2:55p
loading...
/zigman2/quotes/211629951/delayed
US : U.S.: Nymex
$ 80.11
-1.11 -1.37%
Volume: 252,873
Dec. 2, 2022 2:46p
loading...
/zigman2/quotes/208934945/delayed
UK : U.K.: London
5,584.00 p
-14.00 -0.25%
Volume: 1.41M
Dec. 2, 2022 4:35p
P/E Ratio
6.83
Dividend Yield
9.46%
Market Cap
£93.22 billion
Rev. per Employee
£917,806
loading...
/zigman2/quotes/202627887/composite
US : U.S.: NYSE
$ 69.85
+0.67 +0.97%
Volume: 2.26M
Dec. 2, 2022 2:56p
P/E Ratio
6.39
Dividend Yield
9.79%
Market Cap
$114.36 billion
Rev. per Employee
$1.23M
loading...
/zigman2/quotes/201400686/delayed
UK : U.K.: London
558.30 p
+1.60 +0.29%
Volume: 22.63M
Dec. 2, 2022 4:35p
P/E Ratio
6.14
Dividend Yield
3.80%
Market Cap
£71.12 billion
Rev. per Employee
£1.36M
loading...
/zigman2/quotes/201381512/delayed
UK : U.K.: London
3,296.00 p
-5.50 -0.17%
Volume: 1.60M
Dec. 2, 2022 4:35p
P/E Ratio
7.66
Dividend Yield
6.01%
Market Cap
£44.16 billion
Rev. per Employee
£446,346
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