LONDON MARKETS: FTSE 100 Pulled Lower With Oil Prices, Queen's Speech In Focus

Whitbread same-store sales rise

U.K. stocks slipped Wednesday, with energy shares lower as oil prices fell further into a bear market, and investors waiting to hear the government's agenda even as U.K. Prime Minister Theresa May has yet to secure support for her hobbled Conservative Party.

The FTSE 100 gave up 0.2% to 7,458.28, with financial, oil and gas and consumer-goods shares lower. But the consumer-services, basic materials and utilities group were trading higher.

Oil woes: Back in focus are oil prices which continued to fall after they slid into a bear market on Tuesday (http://www.marketwatch.com/story/oil-hovers-at-seven-month-low-as-investors-weigh-up-supply-issues-2017-06-20). That weighed on shares of oil producer Royal Dutch Shell PLC (RDSB.LN) (RDSB.LN) and BP PLC (BP.LN)(BP.LN) , which lost 0.7% and 0.3% on Wednesday, respectively. Energy shares have a hefty weighting of roughly 14% on the FTSE 100, according to FactSet data.

Worries are still lingering about oversupply in the global oil market after the Organization of the Petroleum Exporting Countries and other major oil producers in May agreed to extend production limits into the first quarter of 2018. An recent increase in supply by Libya was a factor in hurting oil prices.

A weekly supply update from the Energy Information Administration is due at 10:30 a.m. Eastern Time Wednesday. Analysts polled by S&P Global Platts expect the EIA to report a fall of 2 million barrels in crude inventories. Late Tuesday, the American Petroleum Institute reported a weekly decline of 2.7 million barrels in U.S. crude supplies (http://www.marketwatch.com/story/api-data-show-a-weekly-decline-in-us-crude-supply-sources-say-2017-06-20).

Parliamentary power struggle: The pound dropped below $1.26 before the formal opening of parliament. Queen Elizabeth II will set out the government's agenda in a speech, but that comes even as the Conservatives are still scrambling to work out a support deal with the Democratic Unionist Party from Northern Ireland.

(https://twitter.com/skydavidblevins/status/877178095744282626)

"The legislation set out in the speech will include the Great Repeal Bill, which converts European Union law into U.K. law and a host of other Brexit-related legislation. But beyond that, the Conservatives' failure to win a majority in this month's election means expectations for new policy initiatives are very low," wrote RBC's chief currency strategist Adam Cole.

Coverage of the Queen's Speech will begin at 11:15 a.m. London time (http://www.parliament.uk/business/news/2017/june/state-opening-of-parliament-2017/), or 6:15 a.m. Eastern Time.

Sterling bought $1.2593, down from $1.2629 late Tuesday in New York.

Stock movers: Whitbread PLC shares (WTB.LN) sprang up 5.1% as the parent company of Costa Coffee and the Premier Inn hotels chain posted a rise of 2.9% in fiscal first-quarter comparable sales (http://www.marketwatch.com/story/whitbread-quarterly-same-store-sales-rise-2017-06-21). Total sales rose 7.6%.

Centrica PLC (CNA.LN) rose 2.4% after the gas and electricity supplier reached a deal to sell two gas power stations in England (http://www.marketwatch.com/story/centrica-sells-2-power-stations-in-uk-2017-06-21) for GBP318 million ($400.7 million) in cash.

Berkeley Group Holdings PLC (BKG.LN) moved up 2.3% as the home builder posted a rise of 53% in fiscal year pretax profit (http://www.marketwatch.com/story/berkeley-yearly-pretax-profit-increases-53-2017-06-21) as it sold more homes at higher prices.

(END) Dow Jones Newswires

June 21, 2017 04:31 ET (08:31 GMT)