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London open: Stocks gain as Unilever, Barclays results impress
London stocks rose in early trade on Thursday, helped along by well-received results from the likes of Unilever and Barclays, and a strong showing from Tesla after hours.
At 0825 BST, the FTSE 100 was up 0.4% at 8,292.73.
Derren Nathan, head of equity research at Hargreaves Lansdown, said: “The FTSE 100 has opened up this morning on what’s set to be a busy day for corporate news on the London market.
“This will follow the worst day in six weeks for US stocks, where rising Treasury yields are pouring cold water on hopes of more aggressive rate cuts by the Fed. If today’s initial jobless claims come in much below consensus forecasts of 242,000, that could send a further signal to rate setters not to overdo it on the loosening front.
“Nvidia, Amazon, Apple and Microsoft, and Tesla all lost ground. However, the electric carmaker rebounded strongly in after-hours trading, after topping analyst estimates.”
In UK equity markets, consumer goods giant Unilever rallied as it reported a jump in third-quarter underlying sales, underpinned by its power brands. Underlying sales grew 4.5%, coming in ahead of analysts’ expectations for 4.2% growth, with volume growth up 3.6%.
Barclays also gained as it nudged up its net interest income guidance for the full year and said it is on track to deliver against its short and medium-term targets. The bank said it expects 2024 net interest income excluding investment bank and head office activities from around £11bn to be “greater than £11bn”.
Anglo American was in the black after a third-quarter production report, while Quilter was boosted by an initiation at ‘buy’ at Jefferies.
Bloomsbury Publishing, Indivior and Softcat also advanced after results.
On the downside, BAE Systems fell as it traded without entitlement to the dividend.
Travis Perkins was under the cosh as it cut its FY24 adjusted operating profit guidance to around £135m from £150m previously.
Dunelm lost ground even as the homeware retailer posted a 3.5% jump in third-quarter sales, driven by volume.
Abrdn also fell after saying it was hit by £3.1bn of outflows in the third quarter.
Top 10 FTSE 100 Risers
| Sponsored by Plus500 |
|
| # | Name | Change Pct | Change | Cur Price | |
|---|---|---|---|---|---|
| 1 |  |
Anglo American Plc | +4.13% | +96.00 | 2,419.50 |
| 2 |  |
Unilever Plc | +4.13% | +192.00 | 4,845.00 |
| 3 |  |
Barclays Plc | +3.84% | +9.15 | 247.30 |
| 4 |  |
South32 Limited | +3.25% | +6.00 | 190.80 |
| 5 |  |
London Stock Exchange Group Plc | +2.60% | +270.00 | 10,655.00 |
| 6 |  |
Fresnillo Plc | +2.16% | +16.50 | 780.00 |
| 7 |  |
Bp Plc | +1.73% | +6.95 | 409.65 |
| 8 |  |
Natwest Group Plc | +1.32% | +4.70 | 361.00 |
| 9 |  |
Banco Santander S.a. | +1.31% | +5.00 | 385.50 |
| 10 |  |
Bt Group Plc | +1.29% | +1.85 | 144.75 |
Top 10 FTSE 100 Fallers
| Sponsored by Plus500 |
|
| # | Name | Change Pct | Change | Cur Price | |
|---|---|---|---|---|---|
| 1 |  |
Bunzl Plc | -2.43% | -86.00 | 3,460.00 |
| 2 |  |
Rolls-royce Holdings Plc | -1.32% | -7.40 | 554.00 |
| 3 |  |
Bae Systems Plc | -1.17% | -15.50 | 1,307.50 |
| 4 |  |
Schroders Plc | -1.10% | -4.00 | 358.80 |
| 5 |  |
Coca-cola Europacific Partners Plc | -0.97% | -60.00 | 6,140.00 |
| 6 |  |
Rentokil Initial Plc | -0.90% | -3.40 | 375.00 |
| 7 |  |
Next Plc | -0.80% | -80.00 | 9,908.00 |
| 8 |  |
Intercontinental Hotels Group Plc | -0.77% | -66.00 | 8,512.00 |
| 9 |  |
3i Group Plc | -0.70% | -23.00 | 3,277.00 |
| 10 |  |
Sse Plc | -0.69% | -13.00 | 1,879.50 |
US close: Stocks slump again as uncertainty weighs on sentiment
US stocks fell for the third day on Wednesday, dropping sharply as investors continued to take profits following recent highs, with shares of Tesla falling ahead of the carmaker’s results due out after the closing bell.
Fast food giant and economic bellwether McDonald’s saw heavy losses on news of a deadly e.coli outbreak, heavyweight aerospace group Boeing slumped after its worst quarterly loss in years, while a number of tech blue chips were also out of favour.
With just four of its 30 constituents trading in positive territory, the Dow Jones Industrial Average closed 1% lower at 42,514.95. Meanwhile, the S&P 500 fell 0.9% to 5,797.42, finishing below the 5,800 mark for the first time in two weeks, while the Nasdaq dropped 1.6% to 18,276.65.
The only major economic data of the day were US existing home sales figures for September, which showed a 1% fall from the previous month to 3.84m. This was the lowest level since October 2010 and worse than the 0.5% decline expected by economists.
Meanwhile, analysts said market sentiment was being dampened by uncertainty surrounding the upcoming elections, with the latest polls showing that former president Donald Trump is leading in the majority of swing states.
Amid the uncertainty, the Federal Reserve’s Beige Book released during Wednesday’s session showed that nine out of 12 districts reported flat or declining economic activity, reinforcing expectations of a rate cut at the Fed’s next meeting in the first week of November.
Chris Beauchamp, chief market analyst at IG, said that the number of upcoming big macro events could be weighing heavily on investors minds.
“Even without thinking about the US election, which is impossible to ignore, the upcoming payrolls report and Fed decision in coming weeks provide two additional hurdles to navigate. While volatility hasn’t exactly spiked, it still feels like there is a nasty surprise lurking just around the corner,” he said.
In other news, the Bank of Canada slashed its benchmark interest rate by 50 basis points to 3.75%, as expected, marking the fourth straight cut. Governor Tiff Macklem said to expect further monetary easing, but acknowledged that inflation was back to the 2% target.
Market movers
McDonald’s dropped 5% after the US Centers for Disease Control and Prevention linked its Quarter Pounders to a fatal E.coli outbreak, which is likely to impact consumer confidence and the company’s outlook.
Tesla shares finished down 2% ahead of the electric carmaker’s results out after the close. “We will be watching to see if Elon Musk can sell a more convincing story about Tesla’s future plans for growth compared to previous earnings reports,” said XTB research director Kathleen Brooks.
Boeing was 2% lower after reporting a significant widening of its third-quarter losses, after being hit by work stoppages and programme charges. The aerospace giant posted a net loss of $7.95bn, compared with a loss of $2.2 million in the same period last year.
Coca-Cola shed 2% despite its reporting that full-year organic sales were set to be at the high end of its previous guidance range. In its third-quarter results, the drinks company said net revenue dipped 1% to $11.9bn, but this was ahead of consensus expectations of $11.6bn.
Tech giants Amazon.com, Nvidia and Apple were all among the worst performers on Wall Street, dragging the wider sector lower.
Meanwhile, telecoms group AT&T was a rare bright spark after reporting third-quarter earnings ahead of analysts’ forecasts and reiterating its annual guidance.
Thursday newspaper round-up: Boeing, property landlords, HSBC
Boeing workers have rejected the latest offer to end the more than a month-long strike that has crippled the already struggling manufacturing giant. In a blow to Boeing and the Biden administration, which has fought for a resolution to the dispute, 64% of the 33,000 members of the International Association of Machinists and Aerospace Workers union voted to reject the contract, the union said late on Wednesday. – Guardian
Vladimir Putin has opened the expanded Brics summit by issuing a call for an alternative international payments system that could prevent the US using the dollar as a political weapon. But the summit communique indicated that little progress had been made on an alternative payment system. Speaking at the summit in the Russian city of Kazan, Putin said: “The dollar is being used as a weapon. We really see that this is so. I think that this is a big mistake by those who do this.” He said that nearly 95% of trade between Russia and China is now conducted in rubles and yuan. – Guardian
Property landlords are braced for record stamp duty bills next year as Rachel Reeves prepares to launch a Budget tax crackdown. The threat to buy-to-let investors has emerged as part of the Chancellor’s plans to unwind stamp duty tax breaks that were introduced by the Conservatives in 2022. This expected policy change means landlords will soon have to pay up to £14,766 in stamp duty on an average home sale, which amounts to the largest bill on record, according to analysis by Hamptons estate agents. – Telegraph
Rachel Reeves should launch a £10bn tax raid on motorists by charging them a fee for every mile they drive, Sir Tony Blair’s think tank has urged. Cars and vans should pay 1p per mile and heavy goods vehicles charged between 2.5p and 4p per mile, according to proposals published by the Tony Blair Institute (TBI). – Telegraph
A plan by the new boss of HSBC to split the bank’s operations internally between East and West has led to fresh calls for the sprawling lender to pursue a full break-up. Georges Elhedery, who became HSBC’s chief executive last month, is aiming to simplify the group through an overhaul he unveiled on Tuesday that includes creating standalone divisions for its Hong Kong business and the bulk of its UK operations and the partition of other businesses into Eastern and Western market regions. – The Times
Priory Group’s finances have come under scrutiny from a short-seller targeting the healthcare chain’s landlord for sale-and-leaseback deals allegedly agreed at inflated prices. Viceroy Research has questioned the strength of the balance sheet of the UK’s largest mental healthcare group in a report outlining its concerns about the practices of the chain’s landlord Medical Properties Trust, which is listed in the US. – The Times
