London midday: Stocks rise as BP turns positive; HSBC in the red
London stocks were firmly in the black by midday on Tuesday, with BP reversing earlier losses as it maintained its dividend despite a slide in quarterly profits.
The FTSE 100 was up 1.5% at 5,933.94.
Chris Beauchamp, chief market analyst at IG, said: "Further gains for the FTSE 100 look odd on a morning when major components like BP and HSBC report poor earnings, but for the most part the gainers in the index are those that will see an upturn in activity as lockdowns ease across most of the globe, if perhaps not yet in the UK.
"This continues the theme from yesterday’s session, when it seemed as if the whole world was looking to a post-coronavirus environment, when some semblance of normality may return. As with US earnings season, the numbers contained within BP’s and HSBC’s updates mostly related to the recent past, which perhaps accounts for the limited downside reaction in their share prices."
BP reversed earlier losses to trade higher as it posted a 66% slump in first-quarter profits due to collapsing oil prices and "demand destruction" caused by the coronavirus pandemic but said it had decided to retain a dividend.
"The decision to hold on to the dividend at BP has also proven to be a positive surprise, the firm likely judging that the hit to its cash pile is outweighed by the headline risks to confidence that could follow should one of the UK’s big dividend firms have to cut back its payout," said Beauchamp.
Retailer Marks & Spencer rallied despite saying that it does not expect to pay a dividend for the 2020/21 financial year and even as data from the Confederation of British Industry showed that retailers suffered their worst fall in sales since the 2008 financial crisis in the first half of April amid the lockdown.
Elsewhere, HSBC was in the red as the bank said first-quarter profit almost halved as revenue fell and it set aside $3bn for credit losses after the Covid-19 crisis took its toll on financial performance. Pre-tax profit for the three months to the end of March dropped 48% to $3.2bn from a year earlier as revenue fell 5% to $13.7bn.
Market Movers
FTSE 100 (UKX) 5,933.94 1.49%
FTSE 250 (MCX) 16,229.35 1.73%
techMARK (TASX) 3,549.80 0.32%
FTSE 100 - Risers
JD Sports Fashion (JD.) 519.00p 7.79%
Barclays (BARC) 97.09p 6.62%
Phoenix Group Holdings (PHNX) 602.80p 5.90%
St James's Place (STJ) 840.80p 5.87%
Royal Bank of Scotland Group (RBS) 113.55p 5.63%
RSA Insurance Group (RSA) 363.80p 5.42%
Informa (INF) 440.50p 5.36%
Prudential (PRU) 1,093.50p 5.19%
Legal & General Group (LGEN) 200.30p 5.14%
Lloyds Banking Group (LLOY) 32.01p 4.83%
FTSE 100 - Fallers
easyJet (EZJ) 576.40p -2.14%
Reckitt Benckiser Group (RB.) 6,472.00p -1.64%
Fresnillo (FRES) 708.20p -1.47%
Bunzl (BNZL) 1,707.50p -1.30%
InterContinental Hotels Group (IHG) 3,555.00p -1.28%
Unilever (ULVR) 4,064.00p -0.93%
HSBC Holdings (HSBA) 413.55p -0.66%
Compass Group (CPG) 1,330.50p -0.63%
Sainsbury (J) (SBRY) 200.20p -0.45%
SEGRO (SGRO) 818.60p -0.32%
FTSE 250 - Risers
Cineworld Group (CINE) 62.06p 14.67%
Wood Group (John) (WG.) 175.40p 10.80%
Games Workshop Group (GAW) 5,830.00p 9.59%
Virgin Money UK (VMUK) 78.10p 7.37%
Drax Group (DRX) 205.00p 7.22%
OneSavings Bank (OSB) 232.20p 7.20%
Rank Group (RNK) 168.40p 6.99%
Dunelm Group (DNLM) 933.00p 6.26%
Ascential (ASCL) 229.20p 6.11%
Royal Mail (RMG) 159.70p 5.97%
FTSE 250 - Fallers
QinetiQ Group (QQ.) 302.80p -4.66%
Spirent Communications (SPT) 246.00p -3.53%
Helios Towers (HTWS) 125.20p -2.49%
Homeserve (HSV) 1,092.00p -2.33%
Coats Group (COA) 44.65p -2.30%
Centamin (DI) (CEY) 164.30p -2.11%
Hill & Smith Holdings (HILS) 1,108.00p -1.77%
Serco Group (SRP) 131.70p -1.57%
Greencoat UK Wind (UKW) 137.40p -1.43%
AJ Bell (AJB) 366.50p -1.35%