Belfast Telegraph

London market stuck in the red as HSBC results disappoint

The FTSE 100 Index closed down 0.89 to 7,246.77.

London’s premier index was rooted in the red on Tuesday as investors baulked at trading updates from banking and mining giants.

The FTSE 100 Index closed down 0.89 to 7,246.77, as HSBC slid more than 3% after missing results missed expectations despite annual profits doubling.

Pre-tax profits jumping 141% to 17.2 billion US dollars (£12.3 billion) in the 12 months to December 31 compared with 7.1 billion dollars (£5.1 billion) a year earlier.

The lender said its focus on the Asian business boosted group profits, while results were also flattered by comparably lower figures in 2016 when it was knocked by moves to offload its Brazilian operation.

Shares were down 23.5p to 737p, with rival lender Lloyds Banking Group dropping 0.1p to 67.9p.

Mining firm BHP Billiton was also enduring a rough ride after posting a plunge in half-year profits.

The firm was the biggest faller on the London market, down 71.6p to 1,490.4p, as attributable profits sank 37% to two billion US dollars (£1.4 billion).

However, underlying earning made for brighter reading, up 14% to 11 billion US dollars (£7.9 billion).

Across Europe, Germany’s Dax climbed 0.8% and the Cac 40 in France lifted 0.6% higher.

On the currency markets, the pound shrugged off a disappointing update from the UK manufacturing industry to push higher against the US dollar and the euro.

While the sector continued to expand at a healthy pace, the Confederation of British Industry (CBI) showed weaker growth in order books in the latest sign that the boost from the weak pound is beginning to fade.

Sterling was 0.1% higher against the greenback at 1.40. Versus the euro, the pound rose 0.6% at 1.13.

The price of oil was marginally higher at 65.66 dollars, building on gains from the previous session when increased tensions between Israel and Iran raised the prospect of a disruption to global supply.

Elsewhere in UK stocks, the owner of hotel chains Holiday Inn and Crowne Plaza was in the doldrums after announcing plans to find 125 million US dollars (£90 million) worth of savings.

Shares in InterContinental Hotels Group sank close to 3%, or 129p to 4,568p, as it posted a hike in annual earnings and said it would look to reinvest in new brands and acquisitions.

It also reported a 14.7% surge in bottom-line pre-tax profits to 678 million US dollars (£485.4 million) for 2017, while underlying earnings lifted 8% to 759 million US dollars (£544 million).

On the second tier, bookmaker William Hill ended the session in positive territory despite being fined £6.2 million by the Gambling Commission over “systemic social responsibility and money laundering failures”.

An investigation by the body revealed that, between November 2014 and August 2016, the bookmaker breached anti-money laundering and social responsibility regulations.

It also found that senior management failed to mitigate risks and to have sufficient staff to ensure that processes for adhering to the regulations were effective.

Shares in William Hill finished 1% higher, rising 4.6p to 328.5p.

The biggest risers on the FTSE 100 Index were Evraz up 20.7p to 432.7p, Smith (DS) up 13p to 488.2p, Standard Life Aberdeen up 8.9p to 381.8p, Ashtead Group up 47p to 2,065p.

The biggest fallers were BHP Billiton down 71.6p to 1,490.4p, HSBC Holdings down 23.5p to 737p, Intercontinental Hotels Group down 129p to 4,568p, WPP down 35.5p to 1,400p.

Weekly Business Digest Newsletter

This week's business news headlines, directly to your inbox every Tuesday.