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London open: Stocks fall as investors brace for big earnings
London stocks fell in early trade on Monday, as investors continued to eye developments in the Middle East and looked ahead to a busy week on the earnings front.
At 0845 BST, the FTSE 100 was down 0.3% at 7,382.70.
Victoria Scholar, head of investment at Interactive Investor, said: “European markets have opened mixed after a tough session for global indices on Friday with the Nasdaq shedding over 1.5%. Sentiment and risk appetite appear to have picked up slightly this morning with safe-haven gold retreating from five-month highs and oil prices easing thanks to diplomatic efforts in the Middle East.
“However, the FTSE 100 is still struggling, weighed down by miners like Fresnillo, Antofagasta, Glencore and Anglo American which are trading near the bottom of the UK blue chip basket. This is on the back of weakness in China with the CSI 300 hitting a more than four year low overnight.”
Investors were bracing for a big week of earnings, with the likes of Alphabet, Microsoft, Amazon and Meta Platforms all slated to report across the pond. In the UK, meanwhile, banks will be in focus, with Barclays kicking off the proceedings on Tuesday, while Lloyds, NatWest and Standard Chartered are also due to report.
In equity markets, Keller Group surged after it lifted its full-year earnings outlook following an “exceptionally strong” first-half performance.
Addiction treatment drug maker Indivior was also a high riser after saying it has agreed to pay $385m to resolve the final lawsuit claims against it in the long-running Suboxone anti-trust case. The company, which makes anti-opioid treatments, said it would also take a $228m charge in the third quarter, which will be excluded from adjusted earnings.
A trial that was scheduled to start on October 30 has been cancelled, Indivior said.
On the downside, Vistry slumped as the housebuilder reiterated its full-year profit guidance but said house sales had failed to pick up as expected. In an update for the third quarter, Vistry warned that private sales activity had remained “subdued, without the normal seasonal pick up since early September and increased use of incentives”.
Top 10 FTSE 100 Risers
| nsored by Plus500 |
|
| # | Name | Change Pct | Change | Cur Price | |
|---|---|---|---|---|---|
| 1 |  |
Ocado Group Plc | +6.72% | +32.70 | 519.40 |
| 2 |  |
International Consolidated Airlines Group S.a. | +1.96% | +2.70 | 140.70 |
| 3 |  |
Flutter Entertainment Plc | +1.57% | +195.00 | 12,645.00 |
| 4 |  |
Marks And Spencer Group Plc | +1.40% | +3.00 | 217.30 |
| 5 |  |
Crh Plc | +1.16% | +52.00 | 4,535.00 |
| 6 |  |
Next Plc | +1.00% | +68.00 | 6,902.00 |
| 7 |  |
Rolls-royce Holdings Plc | +0.98% | +1.95 | 200.90 |
| 8 |  |
Hikma Pharmaceuticals Plc | +0.93% | +18.00 | 1,958.00 |
| 9 |  |
Kingfisher Plc | +0.84% | +1.70 | 202.90 |
| 10 |  |
Sainsbury (j) Plc | +0.68% | +1.70 | 253.40 |
Top 10 FTSE 100 Fallers
| Sponsored by Plus500 |
|
| # | Name | Change Pct | Change | Cur Price | |
|---|---|---|---|---|---|
| 1 |  |
Fresnillo Plc | -4.13% | -22.80 | 528.80 |
| 2 |  |
Rentokil Initial Plc | -3.51% | -16.30 | 447.90 |
| 3 |  |
Tui Ag | -3.40% | -14.00 | 397.20 |
| 4 |  |
Anglo American Plc | -2.33% | -48.00 | 2,013.00 |
| 5 |  |
Direct Line Insurance Group Plc | -2.20% | -3.60 | 160.15 |
| 6 |  |
Glencore Plc | -2.02% | -8.80 | 426.60 |
| 7 |  |
Antofagasta Plc | -2.00% | -26.50 | 1,297.50 |
| 8 |  |
Hargreaves Lansdown Plc | -2.00% | -14.00 | 686.00 |
| 9 |  |
Segro Plc | -2.00% | -14.00 | 687.40 |
| 10 |  |
Taylor Wimpey Plc | -1.96% | -2.05 | 102.70 |
US close: S&P 500 falls for fourth session as bond yields surge
US stocks fell for a fourth straight day on Friday as a surge in bond yields and nervousness surrounding the ongoing conflict in the Middle East dampened the mood on Wall Street.
The Dow finished 0.9% lower, the Nasdaq dropped 1.5% while the S&P 500 fell 1.3%. The S&P 500 has now lost 3.4% of its value over the past four days alone, completely wiping out past gains made throughout October.
“A hawkish Fed, surging US yields and the fear of an escalation in the Middle East have pushed global stock indices into negative territory for the week,” said Axel Rudolph, analyst at IG. “An over 10% surge in the gold price in the past couple of weeks and rise in the price of oil to just below $90 for TWI is not helping inflationary pressures either.”
In a speech on Thursday, Federal Reserve chair Jerome Powell didn’t go as far as saying that another rate hike was on the cards, but said he didn’t think monetary policy wasn’t “too tight right now”.
In prepared remarks, Powell said the recent easing of inflation was a positive sign, but economic indicators in September were “somewhat less encouraging” and that policymakers were “united in our commitment to bringing inflation down sustainably to 2%”.
The yield on a 10-year US Treasury touched a high of 4.997% during the session, setting fresh highs since July 2007, before falling back to the 4.928% level by the close.
“Treasuries finally found support late this week as the 5% level on the 10-year note attracted demand. But the near-term rate outlook remains bearish as the economy enters the fourth quarter with more momentum than previously expected,” said analyst John Canavan from Oxford Economics.
Stock movements
American Express shares finished 5% lower despite the credit card company smashing earnings forecasts and narrowly beating revenue estimates. However, market chatter was suggesting the fall was due to the company’s 58% jump in provisions for credit losses year-on-year.
Also in the red was Schlumberger after the oilfield services group missed sales forecasts for the third quarter, despite an 11% jump year-on-year.
Solar stocks dropped sharply after SolarEdge cut its guidance across the board for the third quarter on the back of softening demand in Europe. Invesco Solar, Sunnova, Enphase and Sunrun also closed with losses.
Monday newspaper round-up: JCB, ULEZ, mobile ‘not spots’
The influential Tory donors behind the JCB digger empire could be hit with a bill for more than £500m to settle a longrunning investigation by HM Revenue and Customs, the Guardian can reveal. The investigation into Anthony Bamford, a Tory peer, and his brother Mark, the director of a subsidiary of the Conservative party, is understood to span a complex network of offshore tax havens and companies. – Guardian
Thousands of fines for breaches of London’s ultra-low emissions zone (Ulez) rules may have been sent unlawfully to drivers of EU-registered vehicles, Belgian authorities claim. The Belgian ministry for transport has ordered an investigation into alleged criminal breaches of data rules after motorists received penalty charge notices from a collections agent acting for Transport for London (TfL). – Guardian
A Government promise to improve mobile coverage in rural areas has been dealt a major setback after network operators warned they will not meet a key deadline. Vodafone, Three and Virgin Media O2 have asked the Government for a delay of up to two years to complete the first stage of the Shared Rural Network (SRN). – Telegraph
Big banks have been accused of giving small businesses “an incredibly poor deal” by offering them less interest on their cash than bigger companies. In a letter to the Treasury Select Committee, Richard Davies, chief executive of Allica Bank, claimed small and medium-sized enterprises (SMEs) should be receiving an extra £7.5bn of interest per year on their deposits. – Telegraph
A parliamentary group that promotes sustainable and ethical business practices is funded by companies that have paid billions of pounds in fines and compensation for fraud, tax and environmental failings. The all-party parliamentary group on environmental, social and governance has received hundreds of thousands of pounds from funders, including KPMG, the accounting group, BAE Systems, the defence manufacturer and Bayer, the drugs multinational. – The Times
The rising costs of raw materials and disrupted supply chains are threatening to derail the winter “golden quarter” for medium-sized businesses in Britain. Companies are concerned about the possibility of suppliers collapsing or of being unable to provide enough basic materials for production. – The Times
