FTSE 100 shares sank on Tuesday, after a session spent gyrating around the flat mark, weighed down by sombre third quarter earnings from a bank and oil company.
Earlier in the session, the market had a light rather than super-charged boost from news that capable helmsman and Canadian banker Mark Carney had decided to extend his tenure as Governor of the Bank of England beyond the weekend proposal of 2018…to 2019. He said he plans to leave as soon as the UK leaves the EU and opted against extending his stay for the full eight years which might have seen him through until 2021.
The FTSE 100 closed down 0.5% at 6917 and led by Standard Chartered PLC (LON:STAN) down 5.4% at 673.3p after its third quarter update. The Asia-facing bank reported underlying pre-tax profits of $458mln, compared with a $139mln loss last year, but chief executive Bill Winters said "income and profit levels are not yet acceptable".
Standard Chartered also said it could face action from Hong Kong's financial regulator over its role as joint sponsor of a share flotation in 2009.
Second-biggest faller was BP (LON:BP.) down 4.5% to 462.05p after it said third-quarter profits had nearly halved.
That contrasted with riser and rival Royal Dutch Shell (LON:RDSB), one of the top risers on the blue-chip index, up 4% to 2199p after better-than-expected results.
The dual-listed oil giant reported underlying profits of $2.8bn for the third-quarter of the year, beating expectations.
In the mid-cap FTSE 250, which ended down 0.1% at 17,523, led by BTG (LON:BTG) down 5.6% to 622p after the stock was downgraded by brokers at Royal Bank Of Canada to a “sector performer” rating.
Meanwhile, shares in Moneysupermarket.com (LON:MONY) jumped 10.3% to 288.9p after the price comparison website reported a 12% rise in third-quarter revenue and added it was on track to meet full-year expectations.
The FTSE AIM 100 Index ended down 0.05% to 3938 and the FTSE AIM All-Share Index down 0.1% to 821.
London stocks gaining were in a minority of 27% and losers totalled 35%.
Midsession
1pm..Carney news met with a big 's what'?
Governor Mark Carney’s decision to stay at the Bank of England until 2019 created a small ripple in the financial markets and it was just enough to keep the FTSE 100 in positive territory.
At 1pm the index of blue-chip shares was up 8.42 points at 6,962.64. The pound rallied a tad too before falling back.
“Any post-Carney tenure extension relief seems to have dissipated this Tuesday Morning, investors now turning their eyes to the litany of macro events cluttering up the next seven days,” said an underwhelmed Connor Campbell, analyst at spread-betting firm Spreadex.
Royal Dutch Shell (LON:RDSA) led the risers after posting better than expected third-quarter earnings .
Following in its wake were the miners, presumably lifted by signs of economic life emanating from China, a key export market for them.
Standard Chartered (LON:STAN), which faces a bit of bother in Hong Kong, was the day’s biggest loser.
Druggie Shire (LON:SHP) wasn’t too far behind after its earnings missed estimates.
11.45am...Standard Chartered under the the cosh
FTSE 100 up 1 to 6,955
Shell rallies but BP falls after both issue results
Standard Chartered under the cosh
The FTSE 100 rollercoaster continued as the blue chip index headed towards lunch.
It's strong start to the morning was soon cancelled out, before a rally saw it edging back towards the 7,000 mark. It's now slightly above yesterday's close to stand at 6,955.
In the small caps, it has been a particularly good morning so far for Northern Petroleum Plc (LON:NOP) which was up 30% after a bullish reserve update for its Canadian assets, while Franchise Brands PLC (LON:FRAN) also posted strong gains.
Gas and electricity holding firm Bilby PLC (LON:BILB) was one of the buiggest fallers though, down 17% after one of its major customers said it was going to move some of Bilby's services in-house.
FTSE 100 rallies as oilers give mixed messages - 10.30am
London was on a switchback ride with FTSE 100 registering healthy gains after dipping in the red following a strong opening.
Oil majors BP (LON:BP.) and Shell (LON:RDSB) enjoyed mixed fortunes. BP was down 2% to 472p as profits tumbled almost 50% to US$933mln.
Shell though perked up 4% to 2,196p as adjusted profits rose 17% to US$2.8bn, boosted by the US$52bn acquisition of BG.
Standard Chartered (LON:STAN) was struggling again as the Asia–focused bank said it had been told to hold more capital, while it faces a regulatory probe in Hong Kong over a float in 2009.
Profits did rise though but not by enough to stop the share price dropping 6% to 668p.
Northern Petroleum Plc (LON:NOP) was a winner among the small caps, adding over 37% to 4.16p as it reported a 30% rise in reserves in Canada despite a 20% fall in the oil price.
Attractions specialist Paragon Entertainment Ltd (LON:PEL) rose 26% to 2.47p as it said revenues this year would be £13.2mln, against forecasts of £11mln, and EBITDA approximately £1mln or double previous expectations.
FTSE slides and the £100mln Football Pools deal falls through - 9.15am
After a strong start on Tuesday, the FTSE 100 gave up all of the early gains and more as it approached midmorning.
The blue chip index fell 8 points to 6,946.25 shortly after 9am.
Sportech plc (LON:SPO) was one of the morning’s biggest fallers after it told investors that the proposed £97.25mln sale of its Football Pools to Burlywood had fallen through.
Attractions designer Paragon Entertainment Ltd (LON:PEL) enjoyed a better Tuesday, shaking off the problems of previous years to post a bullish update in which it said it expects to beat revenue forecasts by 20% this year.
oily start - 8.45am
It was on oil start to the day for the markets with both Royal Dutch Shell PLC (LON:RDSA) and BP PLC (LON:BP.) reporting third quarter results.
The former flew to the top of the FTSE 100 leader board after its earnings exceed forecasts, while the latter was among the top losers after its numbers were hit by a series of charges.
The wider market opened in chipper mood following a solid session in Asia, which in turn was buoyed by better than expected manufacturing data from China. At 8.45am, the FTSE 100 was up 17 at 6,971.
Preview - 6.30am
London's leading shares are expected to open moderately firmer, although trading updates from energy giants BP and Shell may change that.
The FTSE 100 index is expected to open at around 6,963, up nine points on last night's close.
US markets were little changed yesterday, with the S&P 500 steady at 2,126 and the Dow Jones just 19 points weaker at 18,142.
In contrast, Asian markets were enjoying a solid day towards the end of trading, with the Hang Seng index in Hong Kong surging 1.2%, or 277 points, to 23,211 on the back of Chinese manufacturing data. In Tokyo, the Nikkei 225 rose 17 points to 17,442 after the Japanese central bank left its fiscal policies unchanged.
China's official Purchasing Managers' Index (PMI) for manufacturing rose to 51.2 in October from 60.4 the month before; a level above 50 indicates expansion,
The non-manufacturing PMI climbed to 54.0 in October from 53.7.
In the UK, a big day is in store for oil analysts with integrated oil giants BP PLC (LON:BP.) and Royal Dutch Shell PLC (LON:RDSB) both scheduled to make updates.
The statements come at a tricky time for oil companies, with the hoped-for cut in output by the oil producers cartel Opec now looking increasingly likely, thus driving the price of Brent crude to its lowest level since Opec announced its tentative agreement to cut back.
The oil price has bounced back this morning, with Brent crude for January delivery up 36 cents at US$48.97 a barrel in electronic trading.
Around the markets
- Sterling: US$1.2225, down 0.16 cents (0.1%)
- Gold for December delivery: US$1,280.20 an ounce, up 0.6%
- Oil: Brent crude for January delivery – US$48.97 a barrel, up 0.7%.
Headlines
- Tesco sued by investors for £100 million – The Times
- Barclays customers charged twice in latest debit card payment glitch: - The Independent
- Centamin hits milestone as it pays back $1 billion cost of Sukari gold mine – The Daily Telegraph
- Rolls-Royce middlemen may have used bribes to land major contracts – The Guardian
- The Investment Association step up pressure on FTSE bosses to justify bonuses – Daily Express