Sector movers: Oil services hit by crude-price fall, analyst comments

9th Jan 2015 15:36

Oil equipment, services and distribution stocks were trading in the red on Friday as crude prices declined and comments from Morgan Stanley weighed on sentiment.The recent collapse in oil has hammered shares across the energy services sector over the last few months as exploration and production firms have begun scaling back spending and project development plans.Brent crude futures were down 1.3% at $50.31 a barrel after dipping below $50 earlier in the week, a level not seen since May 2009.In a research report to clients, Morgan Stanley pointed out that the current situation in the oil market has several similarities with the downturn in 1986."Back then, the majors responded by cutting cost and capex dramatically, resulting in surprisingly stable free cash flow. Their shares outperformed strongly when oil bottomed out. Oil services however took longer to recover," the bank said.Companies such as Hunting, Wood Group, Petrofac, Amec Foster Wheeler and Greka Drilling were registering losses in afternoon trade. Top performing sectors so far todayInsurance (non-life) 1,970.12 +1.24%Chemicals 11,600.51 +1.01%Industrial Transportation 2,772.56 +0.28%Media 6,498.81 +0.20%Pharmaceuticals & Biotechnology 13,057.00 +0.12%Bottom performing sectors so far todayFood & Drug Retailers 2,926.22 -2.75%Industrial Metals & Mining 1,479.28 -2.53%Oil Equipment, Services & Distribution 15,459.10 -2.12%Household Goods & Home Construction 12,508.55 -1.78%Banks 4,251.31 -1.68%