LONDON (ShareCast) - Footsie is now well in the blue as airlines rally on a slight drop in oil prices and supermarkets get a boost from a broker note.

With crude now trading at just over $126 a barrel, having recently hit $135, British Airways and easyJet are flying high and cruise operator Carnival is buoyant.

Tullow Oil leads oil majors lower, with BG Group, Cairn Energy and BP also slipping back.

Miners are also down in line with falling metal prices, with Vedanta and ENRC the worst affected.

Meanwhile ex-dividend status drags down Marks & Spencer, Next and Cobham.

Shares in Wm Morrison moved higher after Credit Suisse upgraded the supermarket giant to ‘outperform’ from ‘neutral’ and lifted its price target to 340p from 320p. J Sainsbury moves up in sympathy.

JP Morgan has trimmed its price target on the B&Q owner Kingfisher to 134p from 138p, citing excess shop space in the UK and concerns of slower housing starts in France.

Offers are due in for RBS's insurance arm today, though one possible bidder has dropped out. Italy's Generali said the €9bn price being asked is too high.

Outages at its Hartlepool and Heysham 1 stations saw profits tumble at nuclear generator British Energy last year. Underlying profits fell to £882m from £1.22bn, while net profits dropped to £470m from £770m. The two stations are expected to restart over the second and third quarters of FY 2008/09. The dividend for the year is unchanged.

Fashion retailer and wholesaler Burberry upped profits by 25% to £196m in the year to March on revenues up 18% at £995m with "with consistent performance across our regions, channels and products," it said. Burberry added it expects wholesale revenue in the six months to September 2008 to increase by around 10% on an underlying basis, retail space to increase by 12-13% and licensing revenue to be flat.

Hi-tech defence group Qinetiq lifted annual profits by 20% to £127m, adding the current year has also started well. Revenue rose 19% to £1.37bn. Pre-tax profits fell to £51m from £89m. The full year dividend rises by 16%.

Internet sales drove revenue growth at electronics distributor Electrocomponents, with international markets performing especially well. Reported pre-tax profit in the year to 31 March 2008 rose 9% to £95.4m from £87.2m a year earlier. The Chinese market was the star performer, with revenues up 35%.

Tile and flooring retailer Topps Tiles trimmed its interim dividend by a fifth as underlying sales and profits both came under pressure in the first half. Topps said the decision to cut the interim payment to 3p, from 3.75p, and to pay out 50% of earnings in future would give it sufficient flexibility to support its growth plans.

Mezzanine finance provider Intermediate Capital made progress last year despite credit problems elsewhere and expects to benefit further as other sources of finance dry up. Profits in the year to March rose by 2% to £230m with underlying profits, which strip out investment gains, 22% higher at £136m. Gains on investments fell to £137m from £196m. Funds under management at the year-end stood at £7.3bn, up from £5.8bn.

Delays in starting work on the Shell Tower and the Regent Palace Hotel sent asbestos removal specialist Silverdell into the red in the first six months, with full recovery not likely until 2009.

A substantial downturn in the fair value of its investment properties saw property trust Local Shopping REIT fall deep into the red at the interim stage.

Polymer engineering company Avon Rubber scrapped its interim dividends after it slumped into losses for the half year due to contract delays with the US military.

Electronic components distributor Abacus Group toned down expectations for the full year as it halved its dividend at the interim stage. The group said “trading in the first half of 2008 has been ahead of the board’s expectations but for the rest of the year is now expected to be in line with second half 2007.”

The share price of oil explorer Matra Petroleum pulled out of its recent slump Wednesday as it reported a positive development on its Arkhangelovskoe - 12 discovery well. The company said the acid treatment on the Arkhangelovskoe - 12 discovery well on its 100% owned Arkhangelovskoe licence in Orenburg, Russia has successfully removed formation damage.

Oil and gas explorer Empyrean Energy saw its shares surge for the second day in succession as it announced another upbeat update on its Sugarloaf project in Texas. The initial test results from Empyrean’s TCEI JV Block A-1well on Block A at the Sugarloaf project indicated “spectacular condensate and gas flows following a very limited fracture stimulation,” the company said.

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