London open: HSBC leads the gains ahead of Budget
London stocks rose in early trade on Monday, buoyed by a solid set of earnings from HSBC as investors eyed the Budget.
At 0830 BST, the FTSE 100 was up 0.6% to 6,980.17, while the pound was down 0.1% against the dollar at 1.2815 and flat versus the euro at 1.1253.
CMC Markets analyst David Madden said: "Philip Hammond, the Chancellor, will deliver the budget later today and dealers will be listening out for any potential change of policy regarding housing, business rates, VAT, and pension contributions. Some traders are wondering if the help-to-buy scheme will be extended, and there is chatter of higher stamp duty on foreign investors looking to purchase a property in the UK.
"There is speculation Mr Hammond could help out high street retailers by reducing business rates. Off-shore gaming companies could be targeted by higher tax. This will be the last budget before Brexit, and Mr Hammond confirmed that a ‘no-deal’ Brexit would require a new budget."
Ahead of the Budget at around 1530 GMT, net lending to individuals, consumer credit and mortgage approvals are at 0930 GMT.
In corporate news, HSBC was the standout gainer as it reported stronger profit growth than expected for the third quarter as all three of the bank's main businesses enjoyed good growth and progress was made with cost cutting efforts. Profit before tax for quarter of $5.9bn was 28% higher than the same quarter last year, with adjusted PBT up 16% to $6.2bn.
Richard Hunter, head of markets at Interactive Investor, said: "HSBC has seen its share price decline by 19% over the last year, as compared to a 7.5% dip for the wider FTSE 100, and by 17% in the last three months alone.
"By definition, to establish sustained growth into a group of this size will be a marathon rather a sprint, but the initial reaction to these numbers suggest some signs of optimism from investors. It may require further confirmation of a positive direction, however, before the current market consensus of the shares as a hold is subject to material upgrades."
Elsewhere, Rio Tinto ticked up after saying that a non-binding 2016 agreement for Aluminum Corp of China (Chinalco) to acquire the company’s stake in the Simandou iron ore project in Guinea had lapsed. The miner holds 45.05% of the project, with Chinalco (39.95%) and the Guinea government 15%.
IWG was also in the green following a report that the serviced offices provider has held talks with Guy Hands - the owner of private equity firm Terra Firma - about a potential spin-off its Spaces co-working brand.
Transport operator Firstgroup advanced following a weekend press report that some of its shareholders are pushing for a breakup of the company.
On the broker note front, Just Eat was under the cosh as Peel Hunt cut its stance on the stock to 'sell' from 'buy', pointing to recent speculation of a tie-up between Uber and Deliveroo.
Metro Bank was a high riser, however, as Citi recommended buying the challenger bank after the selloff, saying growth was "still excellent".
Market Movers
FTSE 100 (UKX) 6,980.17 0.59%
FTSE 250 (MCX) 18,470.76 0.64%
techMARK (TASX) 3,233.89 0.67%
FTSE 100 - Risers
HSBC Holdings (HSBA) 629.50p 4.05%
Shire Plc (SHP) 4,487.00p 1.98%
Royal Mail (RMG) 355.15p 1.85%
International Consolidated Airlines Group SA (CDI) (IAG) 596.00p 1.78%
Halma (HLMA) 1,267.00p 1.69%
NMC Health (NMC) 3,276.00p 1.49%
easyJet (EZJ) 1,184.75p 1.43%
Antofagasta (ANTO) 756.20p 1.42%
Prudential (PRU) 1,513.00p 1.10%
Smith (DS) (SMDS) 369.90p 1.07%
FTSE 100 - Fallers
Just Eat (JE.) 573.60p -4.69%
Randgold Resources Ltd. (RRS) 6,250.00p -2.59%
WPP (WPP) 853.40p -2.36%
Fresnillo (FRES) 897.00p -1.41%
Carnival (CCL) 4,158.00p -1.09%
Rightmove (RMV) 443.20p -0.76%
Reckitt Benckiser Group (RB.) 6,626.00p -0.66%
Vodafone Group (VOD) 143.24p -0.56%
Centrica (CNA) 146.90p -0.51%
Unilever (ULVR) 4,146.00p -0.49%
FTSE 250 - Risers
Vivo Energy (VVO) 119.88p 5.16%
Metro Bank (MTRO) 2,156.00p 3.85%
Mediclinic International (MDC) 362.40p 3.19%
IWG (IWG) 232.00p 3.11%
Computacenter (CCC) 1,240.00p 2.82%
CLS Holdings (CLI) 212.50p 2.66%
Wizz Air Holdings (WIZZ) 2,646.00p 2.64%
Morgan Advanced Materials (MGAM) 279.00p 2.57%
FirstGroup (FGP) 86.05p 2.50%
Spire Healthcare Group (SPI) 118.50p 2.16%
FTSE 250 - Fallers
Serco Group (SRP) 93.95p -2.44%
Contour Global (GLO) 181.34p -1.98%
Ibstock (IBST) 217.00p -1.18%
Plus500 Ltd (DI) (PLUS) 1,357.00p -1.02%
Barr (A.G.) (BAG) 742.18p -0.91%
Lancashire Holdings Limited (LRE) 581.00p -0.60%
Nex Group (NXG) 1,083.00p -0.55%
PZ Cussons (PZC) 217.80p -0.55%
Wetherspoon (J.D.) (JDW) 1,224.00p -0.49%
Vietnam Enterprise Investments (DI) (VEIL) 430.00p -0.46%