FTSE 350 shares round-up: BP among losers as airlines cash in

As investors assess latest developments in the Middle East, City writer Graeme Evans runs through the winners and losers from US diplomacy.

24th June 2025 13:56

Graeme Evans from interactive investor

A fortnight of share price gains by BP (LSE:BP.) and Harbour Energy (LSE:HBR) were erased in the FTSE 350 index today as traders digested the implications of a sudden reverse in Brent crude futures.

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The pair and North Sea production firm Ithaca Energy Ordinary Share (LSE:ITH) were among the hardest hit after a Iran-Israel ceasefire signalled a dramatic de-escalation of Middle East tensions.

The two-week low for oil and gold prices had a smaller yet still significant impact on Shell (LSE:SHEL), Hochschild Mining (LSE:HOC) and Endeavour Mining (LSE:EDV), while Centrica (LSE:CNA), Drax Group (LSE:DRX) and SSE (LSE:SSE) fell 1-2%.

BAE Systems (LSE:BA.), which earlier this month stood on the brink of breaking the 2,000p threshold for the first time, fell 35.5p to 1,844.5p.

The selling and earlier market resilience meant the FTSE 350 index underperformed leading European benchmarks, particularly in Germany after the Dax rose 2% at one point.

Europe’s big turnaround in risk appetite followed a similarly strong session in Asia, which in turn fuelled demand for London-listed HSBC Holdings (LSE:HSBA), Standard Chartered (LSE:STAN) and Prudential (LSE:PRU).

Renewed hopes that the travel sector can avoid another oil price shock lifted easyJet (LSE:EZJ) to the top of the FTSE 350 risers board, alongside renewed momentum for International Consolidated Airlines Group SA (LSE:IAG). The British Airways and Iberia owner reached midday at 326p, still below the 341p seen on 10 June.

The relief rally in the aerospace sector meant traders resumed their buying of Rolls-Royce Holdings (LSE:RR.) as the engines giant set a record of 912.8p after adding another 26.2p at one point.

Cruise ship operator Carnival (LSE:CCL) also accelerated, while the improved outlook for US interest rates if the lower oil price is sustained helped Barclays (LSE:BARC), publisher Future (LSE:FUTR) and JD Sports Fashion (LSE:JD.).

UBS Global Wealth Management said: “The market response to the escalation and subsequent ceasefire hopes aligns with our view that geopolitical shocks often have limited and short-lived impact on global markets.

“But while markets have taken recent events in stride, several sources of risk and potential volatility remain.”

These include the risk of renewed hostilities in the Middle East and the uncertainty of the self-imposed US deadline for reciprocal tariffs, which draws near on 9 July.

For now, interactive investor customers have been keen to take advantage of today’s oil price reverse after making BP the most-traded stock on our platform. Shell and Harbour Energy are also in the top 10, with most trades being Buy orders.

BP shares fell as far as 331p in mid-April, having been at 433p prior to President Trump’s Liberation Day tariffs.

They were back at 390p yesterday after Brent crude’s rebound above $78 a barrel, only to fall to 371p this afternoon as worries resurfaced over whether the oil major is able to sustain share buybacks at prices below $70 a barrel.

BP only reset its financial framework at the end of February, when it announced plans for a buyback worth between $750 million (£551 million) and $1 billion alongside first-quarter results.

That compared with the $1.75 billion announced with fourth-quarter results, a figure many in the City viewed at the time as unsustainable given net debt of $23 billion. UBS has forecast a figure of $500 million from the second quarter, with the risks skewed to the downside.

In contrast, Shell went into the market turmoil among the European Big Oil stocks most likely to sustain shareholder distributions.

Balance sheet concerns also weighed on independent oil and gas production firm Harbour Energy in today’s session, leaving shares 12% lower at one point this morning.

The group had net debt of $4.2 billion at the end of March, the result of its transformational acquisition of upstream Wintershall Dea assets towards the end of last year.

The $11.2 billion deal added material positions in Norway, Germany, Argentina, Mexico and North Africa, trebling Harbour’s production to about 475,000 barrels of oil equivalent per day.

However, broker Peel Hunt pointed out recently that Harbour’s capital structure increased share price volatility and made it more reactive to underlying commodity prices.

The City firm said that debt reduction would need to be prioritised in order to unlock equity value, although it said that the dividend was secure down to $50 a barrel.

In a recent update, Harbour said the market volatility had reinforced the benefits of its diverse portfolio and that it was well positioned to deliver against capital allocation priorities.

Depending on conditions, this included the potential for additional shareholder returns via buybacks later this year. Shares later settled at 195p, which compares with 210p on Thursday.

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