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London open: Stocks in the black as BP gushes higher after results
London stocks edged higher in early trade on Tuesday, boosted by some-well received results from oil giant BP.
At 0835 BST, the FTSE 100 was up 0.3% to 7,506.18, while the pound was up 0.1% against the euro at 1.1346 and flat versus the dollar at 1.3211.
A survey released earlier by GfK showed UK consumer confidence about the economy worsened in October, ahead of big decisions from the Bank of England later this week, the Budget next month and ongoing Brexit negotiations.
GfK’s consumer confidence index dropped one point to -10 in October as sub-categories for the general economic situation over the last 12 months fell one point and for the coming 12 months decreased by two points.
On the upside, the measure for people’s personal financial situation over the last 12 months and the major purchase index increased by one and two points respectively. The score for people’s personal financial situation over the next 12 months stayed the same.
Although it’s not until Thursday, market participants are likely to be looking ahead to the latest rate announcement from the Bank of England.
CMC Markets analyst Michael Hewson said: “Markets still assign an 86% probability that the Bank will raise rates for the first time in ten years this Thursday, which means the consequences of not doing so are likely to be brutal on the pound.
“Yesterday’s consumer credit numbers showed that borrowing slowed slightly in September but not worryingly so. The latest Gfk consumer confidence did show a slight fall in October to -10 as consumers slowed their spending ahead of the Christmas period, though business confidence does appear to be holding steady for the time being.”
In corporate news, BP gushed higher after it announced a plan to buy back shares as its third-quarter profit beat analysts’ expectations.
Speciality chemicals firm Croda International was also on the front foot after it affirmed its full-year outlook and said that the improved sales trend seen in the first half of 2017 continued through the third quarter.
William Hill and Ladbrokes Coral racked up gains, with traders pointing to some relief that the department of digital, culture, media and sport has launched a 12-week consultation on a range of options to tackle problems with fixed-odd betting terminals, rather than announce an immediate cut to the maximum stakes as thought.
Just Eat advanced as it bumped up its full-year revenue guidance and reported a 47% jump in revenue for the third quarter.
Budget airline Ryanair flew higher after saying it still expects to make record annual profits this year despite disruptions that led to thousands of flights being cancelled.
On the downside, advertising giant WPP was in the red after its sales remained negative in the third quarter as the advertising market continued to be hit by client cost saving.
FTSE 250 packaging company DS Smith was weaker despite saying that trading in the half-year was in line with its expectations, with return on average capital employed at the upper end of the target range.
Engineer Weir Group tanked as it warned that operating profit for the year is expected to be lower than previously indicated due to its minerals operations, despite a strong showing in the oil and gas division.
Glencore fell after the Anglo-Swiss commodity trading and mining group said that it plans to delist its shares from the Hong Kong Stock Exchange at the end of January.
Royal Mail was hit by a downgrade to ‘underperform’ at Credit Suisse, while Renishaw and Electrocomponents were weaker after Peel Hunt downgraded its ratings on the stocks and Rotork was dented by a Goldman Sachs downgrade to ‘neutral’.
