London open: Stocks edge lower as pound recovers ground, HSBC in focus
London stocks edged lower in early trade on Monday as the pound recovered some of its losses from last week ahead of a busy few days that includes rate decisions from the Bank of England and Federal Reserve.
At 0835 BST, the FTSE 100 was down 0.3% to 7,481.81, while the pound was up 0.3% against the dollar at 1.3166 and 0.1% firmer against the euro at 1.1321.
Spreadex analyst Connor Campbell said: “Boy oh boy is it a busy week. Rate votes from both the Federal Reserve and, crucially, the Bank of England, the first Q3 GDP reading from the Eurozone, a slew of manufacturing and services PMIs and, if that wasn’t enough, a non-farm Friday.
"Sadly, Monday is a bit drab in comparison. For the UK the main focus is on the net lending to individuals reading, set to arrive at £5.5bn in September against £5.6bn in August. Investors may also be concerned by the news that the IFS has calculated that by 2021/22 Britain’s deficit will remain at £36bn, almost double the £17bn previously forecast (that leaves Philip Hammond in a bit of a tricky situation heading into November’s budget)."
On the data front, mortgage approvals, consumer credit and M4 money supply are at 0930 GMT.
Investors will also keep an eye on developments in Spain after Madrid stripped Catalonia of its autonomy on Friday and removed Catalan leader Carles Puigdemont from office.
In corporate news, HSBC was on the back foot. Led by its "pivot to Asia", the bank said it continued to grow revenues across its three main businesses in the third quarter but increased investment and bonuses kept underlying profits flat.
Budget airline EasyJet flew higher as swooped to acquire part of the collapsed Air Berlin's operations in Berlin's Tegel airport for €40m.
Glencore was trading lower despite upgrading its full-year marketing guidance, as it said production of some of its commodities fell in the third quarter.
Business information and events group Euromoney Institutional Investor fell after saying it sold Adhesion Group, and its 74% stake in World Bulk Wine Exhibition, to French exhibitions company Comexposium Holding.
Millennium & Copthorne was a little lower reporting a jump in third-quarter pre-tax profit, helped along by solid growth in New York.
Kingfisher rallied after Goldman Sachs upped the stock to ‘buy’, while Drax was boosted by an upgrade to ‘equalweight’ at Morgan Stanley, but IWG was under the cosh after a downgrade to ‘neutral’ at JPMorgan.
Housebuilders Bellway, Berkeley, Persimmon and Redrow were all hit by downgrades from Barclays, with the sector also suffering on the back of expectations of a rate hike by the Bank of England this week.
Market Movers
FTSE 100 (UKX) 7,481.81 -0.31%
FTSE 250 (MCX) 20,141.78 -0.02%
techMARK (TASX) 3,504.91 -0.05%
FTSE 100 - Risers
Kingfisher (KGF) 321.20p 3.51%
easyJet (EZJ) 1,289.00p 1.26%
Convatec Group (CTEC) 201.60p 1.00%
Shire Plc (SHP) 3,634.50p 0.97%
Barclays (BARC) 185.25p 0.79%
WPP (WPP) 1,308.00p 0.62%
Paddy Power Betfair (PPB) 7,585.00p 0.46%
Royal Bank of Scotland Group (RBS) 287.10p 0.45%
Royal Dutch Shell 'A' (RDSA) 2,337.00p 0.43%
Fresnillo (FRES) 1,307.00p 0.38%
FTSE 100 - Fallers
Berkeley Group Holdings (The) (BKG) 3,673.00p -3.52%
Persimmon (PSN) 2,778.00p -1.87%
Taylor Wimpey (TW.) 198.40p -1.73%
Barratt Developments (BDEV) 645.50p -1.68%
Glencore (GLEN) 362.05p -1.40%
British American Tobacco (BATS) 4,959.50p -1.24%
Diageo (DGE) 2,579.50p -1.09%
International Consolidated Airlines Group SA (CDI) (IAG) 617.00p -1.04%
Mondi (MNDI) 1,849.00p -0.91%
Anglo American (AAL) 1,406.00p -0.88%
FTSE 250 - Risers
Drax Group (DRX) 292.50p 3.47%
Indivior (INDV) 342.30p 3.10%
Tullow Oil (TLW) 182.70p 2.64%
Stobart Group Ltd. (STOB) 284.00p 2.53%
Capital & Counties Properties (CAPC) 262.00p 2.34%
Genus (GNS) 2,269.00p 1.52%
Hunting (HTG) 524.50p 1.35%
Inmarsat (ISAT) 596.50p 1.19%
Aldermore Group (ALD) 303.00p 1.17%
Marshalls (MSLH) 477.80p 1.10%
FTSE 250 - Fallers
Bellway (BWY) 3,569.00p -3.49%
IWG (IWG) 201.80p -3.44%
Redrow (RDW) 633.50p -2.16%
Ferrexpo (FXPO) 251.20p -2.03%
Dixons Carphone (DC.) 174.00p -1.97%
Acacia Mining (ACA) 183.00p -1.45%
Bovis Homes Group (BVS) 1,162.00p -1.44%
Tate & Lyle (TATE) 645.00p -1.23%
Galliford Try (GFRD) 1,225.00p -1.21%
National Express Group (NEX) 365.70p -1.08%