London open: Stocks edge lower, with HSBC under pressure after results
Stocks in London edged lower in early trade as investors sifted through a raft of corporate news, including a disappointing set of results from banking giant HSBC.
At 0830 GMT, the FTSE 100 was down 0.3% to 7,279.49.
Public sector net borrowing is at 0930 GMT, while Bank of England governor Mark Carney is due to address the Treasury Select Committee at 1000 GMT on the contents of the most recent Inflation Report.
Ipek Ozkardeskaya, senior market analyst at London Capital Group. said: “Despite the recent rise in the UK’s consumer prices, the BoE Governor Mark Carney could talk down the rising inflationary pressures by insisting that the pressures on wages could ease, as the UK’s labour market nears the full-employment. If this is the case, we could see a pound recovery above the $1.25 against the greenback. The key resistance stands at $1.2575 (minor 23.6% retracement on post-Brexit decline).
In corporate news, HSBC slumped after it threw in an extra £1bn share buyback and offered assurance of maintaining its dividend to try and keep investors as it reported a bigger-than-expected drop in annual profits. The largest company on the FTSE 100 delivered a reported profit before tax of $7.1bn that was down 62% on the prior year.
Mediclinic was in the red as it warned there will be a fall in revenue in its Middle East business.
Building materials firm Wolseley slipped as it announced it will merge its Swiss plumbing and heating business with Walter Meiro, a Swiss heating and ventilation and air conditioning distributor.
Capita was on the back foot as it said it has undertaken a comprehensive review across its major contracts, and as a result management has decided to impair, at year end 2016, a number of historic assets relating to a few specific contracts, which were being amortised over their contract life.
Galliford Try was in the red despite posting a rise in first-half revenue and profit and lifting its dividend.
Wood Group gushed lower after it reported a 16% drop in full-year revenue and a 62% decline in profit, and said it remains cautious on the near-term outlook.
Online electricals retailer AO World was under the cosh after Morgan Stanley downgraded it to ‘underweight’ from ‘equalweight’.
On the upside, Australian mining giant BHP Billiton pushed higher after it more than doubled its interim dividend payout as it reported a massive jump in underlying profits which were underpinned by a recovery in commodity prices and demand from China.
InterContinental Hotels Group rallied after reporting an increase in full-year operating profit and saying it will return $400m to shareholders via a special dividend and share consolidation.
LondonMetric ticked up after acquiring a regional distribution warehouse in Wakefield for £9.5m and a last mile distribution warehouse in Dartford for £6.3m, reflecting a blended net initial yield of of 5.8% and a reversionary yield of 6.4%.
Infrastructure group Balfour Beatty edged higher after agreeing to sell its entire share in Dutco Balfour Beatty and BK Gulf for a total cash consideration of £11m.
WH Smith was boosted by an upgrade to ‘buy’ from Investec, while OneSavings was dragged lower by a downgrade from the same outfit.
Market Movers
FTSE 100 (UKX) 7,279.49 -0.28%
FTSE 250 (MCX) 18,736.59 -0.05%
techMARK (TASX) 3,359.07 0.08%
FTSE 100 - Risers
InterContinental Hotels Group (IHG) 3,993.00p 2.97%
Anglo American (AAL) 1,393.50p 2.46%
BHP Billiton (BLT) 1,426.00p 1.86%
Sage Group (SGE) 643.00p 1.34%
Antofagasta (ANTO) 870.00p 1.34%
Persimmon (PSN) 2,026.00p 1.20%
Admiral Group (ADM) 1,873.00p 0.92%
Rio Tinto (RIO) 3,679.00p 0.91%
Glencore (GLEN) 329.90p 0.89%
Taylor Wimpey (TW.) 176.90p 0.74%
FTSE 100 - Fallers
Mediclinic International (MDC) 751.00p -6.36%
HSBC Holdings (HSBA) 676.90p -4.97%
Hargreaves Lansdown (HL.) 1,315.00p -3.52%
Capita (CPI) 502.50p -2.24%
Standard Chartered (STAN) 750.10p -1.95%
Royal Bank of Scotland Group (RBS) 256.10p -1.08%
Barclays (BARC) 235.05p -1.03%
Croda International (CRDA) 3,372.00p -0.68%
Standard Life (SL.) 372.90p -0.67%
3i Group (III) 713.50p -0.63%
FTSE 250 - Risers
WH Smith (SMWH) 1,702.00p 4.74%
Henderson Group (HGG) 229.90p 2.54%
Essentra (ESNT) 495.60p 2.42%
Ibstock (IBST) 200.10p 2.20%
CYBG (CYBG) 273.00p 1.37%
IP Group (IPO) 176.00p 1.32%
Millennium & Copthorne Hotels (MLC) 427.00p 1.07%
Kaz Minerals (KAZ) 575.50p 1.05%
Tullow Oil (TLW) 271.80p 1.04%
Woodford Patient Capital Trust (WPCT) 93.10p 0.98%
FTSE 250 - Fallers
Wood Group (John) (WG.) 750.50p -8.25%
OneSavings Bank (OSB) 386.90p -2.96%
Amec Foster Wheeler (AMFW) 440.80p -2.80%
Petrofac Ltd. (PFC) 848.50p -2.42%
AO World (AO.) 156.40p -2.25%
Aldermore Group (ALD) 231.40p -1.82%
Safestore Holdings (SAFE) 382.60p -1.62%
Ascential (ASCL) 312.00p -1.55%
Hunting (HTG) 565.50p -1.39%
Bovis Homes Group (BVS) 745.50p -1.26%