HSBC profits fall, AstraZeneca offloads angina drug

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The FTSE 100 is expected to mount a small, four-point rise on the Tuesday after the May Day bank holiday.

Stocks to watch

HSBC's first-quarter profits fell 14% compared to last year but better than was expected by analysts, with chief executive Stuart Gulliver expressed confidence that cost-reduction plans now under way will hit their target by the end of next year. Amid a tough few months for the industry, the banking giant saw its profits before tax dwindle 14% to $6.12bn at the reported level, or 18% to $5.43bn on an adjusted basis. The consensus forecast was for a PBT of $4.2bn.

AstraZeneca said it has completed the divestment of the global rights to angina treatment Imdur, outside the US, to China Medical System Holdings Ltd and its associated company, Tibet Rhodiola Pharmaceutical Holding Co. Under the agreement, AstraZeneca will receive $190m for the rights to Imdur.

Aviva said it has completed the acquisition of an additional 23% share in Aviva India from its joint venture partner Dabur Invest Corp. The acquisition follows recent regulatory changes which allowed Aviva to increase its shareholding to 49%, the maximum allowed under India's foreign direct investment limits (FDI).

Regus, a provider of flexible workspace solutions, said it expects to deliver full-year results in line with management's views as it reported “good trading” in the three months to the end of March. The FTSE 250 company said group revenue rose to £532.5m from £452.3m in the first quarter of last year, a 14.5% increase at constant currency, thanks to the development of 554 locations added during 2015.

Newspaper round-up

US investors may be profiting from leaked economic data releases that allow them to front-run market-moving news, according to a research paper published by the European Central Bank. Macroeconomic news announcements can move markets, as traders watch for indications about how the economy is performing. - Financial Times

Worries about the EU referendum in June, rising labour costs and China’s slowdown have knockedUK business confidence to a four-year low, according to a report that will fan fears the economy is losing momentum. A poll of 1,000 chartered accountants by their professional body, the ICAEW, echoed other recent surveys pointing to fragile consumer and business confidence as the referendum approaches. The poll also noted a slowdown in domestic sales and nervousness about hiring new staff. - Guardian

BT Group is in talks to open up its infrastructure to a rival in a landmark test of Ofcom’s plan to introduce more competition for its much criticised Openreach network monopoly. Openreach is in discussions with City Fibre, the alternative broadband network builder, about a large-scale fibre-optic roll-out over BT’s ducts and poles in Southend, according to industry sources. It is understood that BT is currently surveying its infrastructure in the Essex town to get the project under way. - Telegraph

A senior executive at Barclays has alleged money laundering and mis-selling failures at the bank’s French operations, casting a shadow over the British group’s plan to sell its business in France to a private equity group. A letter dated April 5 from Philippe Hébert, chief risk officer of Barclays France, to Tony Blanco, chief executive of Barclays France, alleged serious shortfalls in the bank’s standards of controls, compliance and conduct. - Financial Times

US close

US stocks mounted a strong rally on Monday, with confidence in consumer-discretionary shares and tech titans like Amazon and Netflix helping the Nasdaq break out of a seven-day losing streak.

The Nasdaq Composite rose 0.88% to close at 4,817, while the Dow Jones Industrial Average advanced 0.7% to 17,890 and the S&P 500 put on 0.78% to 2,081 to end their two-day declines.

A report from the Institute for Supply Management (ISM) showed its index of national factory activity fell to 50.8 from 51.8 the month before, below expectations of 51.4.

Other major data showed construction spending rose to an eight and a half-year high in March, with the Commerce Department revealing a 0.3% increase, following an upwardly revised 1.0 percent jump in February.