Top-flight shares were treading water on Thursday as negative news from the banking sector offset upbeat results from miners and telecom companies.
The FTSE 100 Index was 3.2 points adrift at 6,747.24 in early trading as Lloyds Banking Group PLC (LON:LLOY) doubled quarterly profits but warned on the UK outlook.
Lloyds said first-half statutory profit before tax more than doubled to £2.5bn, although underlying profit fell 5% to £4.2bn and total income dropped 1% to £8.9bn.
The bank hiked its interim dividend 13% year-on-year to 0.85 pence per share and affirmed its guidance for 2016.
But it unveiled plans to close an extra 200 branches and cut a further 3,000 jobs by the end of 2017. Lloyds shares fell 1.84p, or 3.3%, to 53.91p.
Chief executive António Horta-Osório said: "Following the EU referendum, the outlook for the UK economy is uncertain.
"While the precise impact depends upon a number of factors, including EU negotiations and political and economic events, a deceleration of growth seems likely."
Elsewhere, Anglo American plc (LON:AAL) gained 6.5% to 851.3p as it reduced net debt by more than US$1bn in the first half and said cost cuts and asset sales were on track.
Shares in Sky PLC (LON:SKY) were up 7% at 950p as the satellite broadcaster reported higher sales and profits but said customer turnover had increased amid competition from rivals.
One of those competitors, BT Group PLC (LON:BT.A), also saw its shares rise nearly 3% to 413.5p after reporting a good first quarter.
Premier Farnell PLC (LON:PFL) soared 16.7% to 192p as it got a rival takeover offer from US company Avnet Inc (NYSE:AVT), trumping an earlier bid from a Swiss engineer.
In small-caps, Octagonal Plc (LON:OCT) jumped 28.57% to 1.35p as sUBSidiary Global Investment Strategy reported a record first quarter.
Redstoneconnect PLC (LON:REDS) bounced 18.75% to 1.42p after the smart building technology supplier won a three-year contract from investment bank UBS.
But Altona Energy Plc (LON:ANR) lost 21.74% to 0.45p on news that its Arckaringa Coal Chemical joint venture would need a petroleum exploration licence before starting test drilling at its Arckaringa site in South Australia.
And Australian gold miner Keras Resources plc (LON:KRS) lost its gleam by 23.9% to 0.88p after reporting lower-than-expected production and higher costs from its small pits.
The top winner was Rolls-Royce Holdings PLC (LON:RR.), up 13.4% to 830p.
The biggest loser was Smith & Nephew PLC (LON:SN.), down 4.1% to 1,247p. Net profit fell 18% due to weak China sales.
Preview at 6.51am
FTSE 100 is called to open marginally lower as Asian equities lagged overnight and the US Fed made no move on raising interest rates.
The blue chip benchmark closed Wednesday at a more than one-year high, while junior market AIM had its best level in over two years, and mid-caps briefly beat pre-Brexit levels.
Among risers were housebuilders and drugs group, GlaxoSmithKline (LON:GSK), which announced investment in the UK. Also cheering investors was UK second quarter growth data.
FTSE 100 closed 26 points up at 6,750 but today is called to open around four points lower.
In the US, the Dow Jones barely moved the needle, closing down 0.01% to 18,472, while the S&P500 lost 0.12% at 2,166. The tech heavy Nasdaq exchange added 0.58% to stand at 5,139.
Japan's market tumbled 193 points, or 1.16% overnight, as traders are wary about government measures on a stimulus package and in China, there were reportedly fears over a clampdown on certain financial products.
As had been widely expected, in the USA, Janet Yellen made no change on interest rates, deciding to hold rates between 0.25% and 0.5% due to inflation below the bank's target, though a rise is still expected this year.
Household spending in the US is increasing, as are jobs.
Another day of UK earnings are expected today, with around one-sixth of the FTSE 100 companies set to update the market.
Oil giAnt Royal Dutch Shell (LON:RDSB) is one, as is banking titan Lloyds Banking (LON:LLOY). AstraZeneca (LON:AZN) and Diageo (LON:DGE) also report.
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