London open: FTSE gains as investors eye Fed meeting; HSBC rallies

30th Apr 2024 07:58

(Sharecast News) - London stocks rose in early trade on Tuesday, helped along by solid performances from the likes of HSBC and Coca-Cola HBC, as investors eyed the start of the Federal Reserve's two-day policy meeting.

At 0850 BST, the FTSE 100 was 0.3% firmer at 8,172.36.

Susannah Streeter, head of money and markets at Hargreaves Lansdown, said: "The FTSE 100 has set off on a climb higher, nudging ahead again on a record-breaking run. The fresh pulse of positivity comes as ceasefire negotiations in the Middle East continue and a more optimistic sentiment washes over the London market.

"Even the surprise resignation of HSBC boss Noel Quinn, didn't stop the banking giant from posting share price gains this morning. Sharp gains may be held back, with a little more caution creeping in as the key meeting at the Federal Reserve starts, with speculation still swirling about how long interest rates will linger in the US.

"Although the world's largest economy slowed more sharply than expected in the first three months of the year, key inflation readings show inflation remains stubborn and that's dashed hopes for early and multiple rate cuts. If interest rates do linger for a lot longer, it's raised concerns about the growth prospects for the engine of the global economy."

On home shores, investors were mulling the latest figures from the British Retail Consortium and NielsenIQ, which showed that the price increases at UK tills fell to their lowest since the end of 2021 in April as food inflation eased for the 12th straight month.

The annual rate of shop price inflation fell to just 0.8% in April, down from 1.3% in March, the BRC-NeilsenIQ Shop Price Index showed.

This was well below the three-month average rate of 1.4% and the lowest year-on-year increase since December 2021.

Non-food prices were 0.6% lower than where they were last year, with annual deflation accelerating from -0.2% the previous month. This was the sharpest decline since October 2021.

Meanwhile, food price increases fell to 3.4% from 3.7%, falling to its lowest since March 2022. Fresh food inflation slowed to 2.4% from 2.6%, hitting its lowest since November 2021, while ambient food inflation fell to 4.9% from 5.2%, its lowest since June 2022.

"One year on from the peak, shop price inflation levels are showing signs of normalising, providing relief to households," said Helen Dickinson, the chief executive of the BRC.

"While consumers will welcome the lower shop price inflation, geopolitical tensions and the knock-on impact on commodity prices, like oil, pose a threat to future price stability. Retailers will continue to do all they can to keep prices down, but Government has a role to play with pro-growth policies that allow businesses to invest in the customer offer."

In equity markets, HSBC was the top gainer on the FTSE 100 as it announced that chief executive Noel Quinn was unexpectedly stepping down after nearly five years in the job, and released first-quarter results.

Quinn, 62, will remain in post until a new CEO is appointed. The news came as the lender posted a 1.8% drop in first-quarter profit to $12.7bn (£10bn), slightly higher than expectations and unveiled a $3bn share buyback as revenues increased 3% to $20.8bn.

"After an intense five years, it is now the right time for me to get a better balance between my personal and business life," Quinn said.

Coca-Cola HBC was also in the black as it said first-quarter revenue beat forecasts and reiterated guidance that annual operating profit would grow further on the back of strong demand.

Hargreaves Lansdown and Rotork were both higher on the back of well-received trading updates.

Telecom Plus advanced as it said full-year adjusted pre-tax profit was set to be towards the upper end of market expectations after a record year.

On the downside, Prudential declined even as it reported an 11% rise in first-quarter net new business profit, while St James's Place fell after it posted a fall in first-quarter net inflows.

Whitbread lost ground as it announced a £150m share buyback and beefed up its dividend after seeing its bottom line jump by more than a third in the year to 29 February, and unveiled plans to cut 1,500 jobs as it turns underperforming restaurants into more hotels.

Market Movers

FTSE 100 (UKX) 8,172.36 0.31%

FTSE 250 (MCX) 20,128.37 0.22%

techMARK (TASX) 4,600.25 0.10%

FTSE 100 - Risers

HSBC Holdings (HSBA) 684.50p 2.45%

Coca-Cola HBC AG (CDI) (CCH) 2,616.00p 1.55%

Standard Chartered (STAN) 693.60p 1.43%

Beazley (BEZ) 666.50p 1.37%

Rightmove (RMV) 523.00p 1.24%

Intermediate Capital Group (ICG) 2,056.00p 1.18%

Sainsbury (J) (SBRY) 265.00p 0.99%

Haleon (HLN) 334.50p 0.97%

Pershing Square Holdings Ltd NPV (PSH) 3,968.00p 0.92%

Tesco (TSCO) 294.60p 0.89%

FTSE 100 - Fallers

Prudential (PRU) 708.60p -4.42%

Fresnillo (FRES) 579.00p -1.95%

Ocado Group (OCDO) 349.60p -1.63%

St James's Place (STJ) 438.20p -1.48%

International Consolidated Airlines Group SA (CDI) (IAG) 175.00p -1.24%

Whitbread (WTB) 3,015.00p -1.05%

Convatec Group (CTEC) 250.80p -0.95%

Vodafone Group (VOD) 69.36p -0.91%

JD Sports Fashion (JD.) 115.60p -0.86%

Entain (ENT) 811.40p -0.83%

FTSE 250 - Risers

Hargreaves Lansdown (HL.) 845.40p 7.61%

Playtech (PTEC) 533.00p 3.70%

Rotork (ROR) 325.00p 2.85%

Telecom Plus (TEP) 1,756.00p 2.45%

Tate & Lyle (TATE) 655.00p 1.95%

Victrex plc (VCT) 1,298.00p 1.88%

Tritax Eurobox (GBP) (EBOX) 55.90p 1.82%

Foresight Solar Fund Limited (FSFL) 89.50p 1.82%

TBC Bank Group (TBCG) 3,520.00p 1.73%

Savills (SVS) 1,098.00p 1.48%

FTSE 250 - Fallers

CMC Markets (CMCX) 265.50p -2.93%

Jupiter Fund Management (JUP) 77.60p -1.77%

JPMorgan Emerging Markets Inv Trust (JMG) 103.00p -1.72%

Rathbones Group (RAT) 1,618.00p -1.70%

Apax Global Alpha Limited (APAX) 142.00p -1.53%

Wizz Air Holdings (WIZZ) 2,200.00p -1.43%

Trainline (TRN) 304.80p -1.42%

Edinburgh Worldwide Inv Trust (EWI) 140.40p -1.27%

Bellevue Healthcare Trust (Red) (BBH) 140.80p -1.26%

Monks Inv Trust (MNKS) 1,140.00p -1.21%