London midday: Stocks maintain gains; HSBC dips after results

London stocks had maintained gains by midday on Monday, as investors mulled results from the likes of HSBC and Pearson, and looked ahead to a series of key central bank policy announcements.

The FTSE 100 was up 0.9% at 7,355.08.

Rate decisions are due this week from the Bank of England, the Bank of Japan and the US Federal Reserve.

The BoE is expected to keep interest rates unchanged on Thursday.

Susannah Streeter, head of money and markets at Hargreaves Lansdown, said: "The FTSE 100 has opened in positive territory as investors look ahead to key interest rate decisions with a glass-half-full attitude, and keen to take advantage of stock prices that have largely fallen back over recent weeks.

"Although the conflict in Israel is a humanitarian crisis, and the risks of regional escalation are still clear and present, the offensive in Gaza was widely expectedly and investors had anticipated this turn of events to some extent. Although supply concerns are still hanging around, keeping a floor on oil prices, concerns about a drag on growth ahead leading to weaker demand have prompted a fall in oil prices, although Brent crude is still hovering around $90 a barrel."

On the macro front, figures released earlier by the Bank of England showed that mortgage approvals fell in September to their lowest level since January, dented by rising borrowing costs.

Net mortgage approvals for house purchases declined to 43,300 from 45,400 in August. Economists were expecting 44,500.

Meanwhile, approvals for re-mortgaging fell from 25,100 in August to 20,600 - the lowest level since January 1999.

Net borrowing of mortgage debt by individuals dropped to £0.9bn in September from £1.1bn in August. This was the lowest level since April.

Andrew Wishart, senior property economist at Capital Economics, said the drop in mortgage approvals "reflects the second spike in the average advertised mortgage rate to 5.9% in July with the usual two-month lag".

"Given the drop back in mortgage rates since September probably marked the trough. Net mortgage lending also turned negative again as the slump in approvals in recent months fed through to lower mortgage advances (funds being distributed)," he added.

In equity markets, Airtel Africa jumped to the top of the FTSE 100 as it reported a rise in half-year revenues and said it expects to deliver an improved EBITDA margin in FY24 versus the year earlier.

Education publisher Pearson was in the black as it lifted its profit guidance for the full year by £20m despite a slowdown in revenue growth in the third quarter.

Ascential rocketed after agreeing to sell its digital commerce business and its product design business, WGSN, for a combined £1.4bn. The digital commerce business will be sold to Omnicom for around £741m, while WGSN will be sold to Apax Partners for up to £700m.

Mike Ashely’s Frasers Group rose after saying it had sold the Missguided fast-fashion brand to Shein for an undisclosed sum, and hinting at further potential collaborations with the Chinese ecommerce giant.

Rightmove rallied as Berenberg upgraded the shares to ‘buy’ from ‘hold’, saying the selloff since the OnTheMarket/CoStar deal was announced was overdone.

On the downside, HSBC reversed earlier gains to trade a touch lower, after it posted a smaller-than-expected jump in third-quarter profits and announced a $3bn share buyback. In the three months to the end of September, pre-tax profit rose to $7.7bn from $3.2bn in the same period a year earlier, falling short of consensus expectations of $8.1bn.

AJ Bell was dented by a downgrade to ‘neutral’ from ‘buy’ at Citi, which said it was awaiting "a better entry point".

Market Movers

FTSE 100 (UKX) 7,355.08 0.88%
FTSE 250 (MCX) 17,028.40 0.96%
techMARK (TASX) 3,999.32 1.20%

FTSE 100 - Risers

Airtel Africa (AAF) 118.50p 7.92%
Pearson (PSON) 942.40p 2.52%
St James's Place (STJ) 633.80p 2.49%
Rightmove (RMV) 491.10p 2.48%
Smiths Group (SMIN) 1,607.00p 2.36%
BAE Systems (BA.) 1,106.50p 2.08%
Smith & Nephew (SN.) 914.80p 2.08%
Auto Trader Group (AUTO) 614.00p 2.06%
Diageo (DGE) 3,083.50p 1.93%
Flutter Entertainment (CDI) (FLTR) 13,025.00p 1.92%

FTSE 100 - Fallers

Ocado Group (OCDO) 473.50p -1.93%
Marks & Spencer Group (MKS) 213.40p -0.51%
HSBC Holdings (HSBA) 599.50p -0.25%
United Utilities Group (UU.) 1,051.00p -0.24%
Scottish Mortgage Inv Trust (SMT) 641.60p -0.19%
3i Group (III) 1,965.00p -0.18%
BP (BP.) 529.70p -0.15%
Smurfit Kappa Group (CDI) (SKG) 2,650.00p -0.08%
Sainsbury (J) (SBRY) 255.40p -0.04%
F&C Investment Trust (FCIT) 839.00p 0.00%

FTSE 250 - Risers

Ascential (ASCL) 274.40p 27.27%
CAB Payments Holdings (CABP) 49.75p 4.63%
Renishaw (RSW) 3,084.00p 4.54%
Ruffer Investment Company Ltd Red PTG Pref Shares (RICA) 273.00p 4.20%
Wizz Air Holdings (WIZZ) 1,612.50p 4.03%
Helios Towers (HTWS) 61.60p 3.88%
Ithaca Energy (ITH) 170.30p 3.84%
Bridgepoint Group (Reg S) (BPT) 184.90p 3.47%
Essentra (ESNT) 153.00p 3.24%
Dr. Martens (DOCS) 118.60p 3.13%

FTSE 250 - Fallers

CLS Holdings (CLI) 85.60p -3.39%
W.A.G Payment Solutions (WPS) 91.00p -3.19%
Ferrexpo (FXPO) 74.90p -2.35%
AJ Bell (AJB) 252.20p -2.25%
Jlen Environmental Assets Group Limited NPV (JLEN) 88.50p -1.56%
Octopus Renewables Infrastructure Trust (ORIT) 83.60p -1.42%
IP Group (IPO) 43.00p -1.38%
Ceres Power Holdings (CWR) 193.90p -1.07%
NextEnergy Solar Fund Limited Red (NESF) 81.65p -1.03%
Twentyfour Income Fund Limited Ord Red (TFIF) 94.50p -0.94%