HSBC beats interim profit estimates, Rio Tinto maintains interim dividend

Stocks to watch

HSBC on Wednesday said it would start a $3bn share buyback after the Asia-focused bank reported estimate-busting interim profits in its final set of results under chief executive Noel Quinn. Pre-tax profits surged to $8.9bn from $8.8bn a year earlier and smashed analysts’ forecasts of $7.8bn. Quinn, who has been CEO for five years will be succeeded by finance chief Georges Elhedery. The bank announced that financial controller Jon Bingham would take on the chief financial officer role on an interim basis.

Rio Tinto reported underlying EBITDA of $12.1bn in its half-year results on Wednesday, up 3%, and net earnings growth of 14% to $5.8bn. The FTSE 100 mining giant said it generated $7.1bn in net cash from operating activities for the six months ended 30 June, up 1%, as it kept its dividend stable at 177 cents per share.

Newspaper round-up

The hidden cost of rising workplace sickness in the UK has increased to more than £100bn a year, largely caused by a loss of productivity amid “staggering” levels of presenteeism, a report warns. Analysis by the Institute for Public Policy Research (IPPR) shows the cost of staff sickness has grown by £30bn a year to £103bn in 2023. The annual bill was £73bn in 2018, its study found. – Guardian

The Competition and Markets Authority has begun a preliminary investigation into a partnership between Google and the AI startup Anthropic, marking the latest in a string of investigations into deals between big tech companies and smallerAI ones. Google invested $2bn (about £1.56bn) into Anthropic in 2023, shortly after signing a cloud computing agreement with the startup, which develops the Claude LLM and chatbot. – Guardian

Rachel Reeves’ decision to end winter fuel payments gave Britons a taste of who the Chancellor is likely to hit with higher taxes in her maiden Budget. Reeves insists it won’t be workers. “We will not balance the books on the backs of hardworking people,” she said on July 29 as she warned of a £22bn hole in the public finances. – Telegraph

Carpetright collapsed owing an estimated £213 million to customers, suppliers and landlords, who are to be left almost entirely out of pocket. Hundreds of unsecured creditors — including Royal Mail and Microsoft — are expected to recover less than 1p in the pound of their debts, according to administrators’ proposals seen by The Times. The carpet suppliers Betap and Condor were owed £1.9 million and £1.1 million respectively when Britain’s biggest flooring chain collapsed last week. Microsoft was owed £3.1 million; Biffa, the waste management company, £852,000; Royal Mail, £372,000; and DHL, the logistics company, £540,000. – The Times

Ten listed company directors, deal advisers and senior lawyers have been branded dishonest and deceitful in a stock market scandal kept under wraps for 12 years but disclosed for the first time on Tuesday. The Takeover Panel revealed the scam and named the culprits, who include Richard Balfour-Lynn, a well-known former figure in the property and hotels world, and Julian Treger, the notorious activist investor from the early 2000s. – The Times

US close

US stocks were mixed on Tuesday, with the Dow rising but the S&P 500 and Nasdaq firmly in the red, as investors digested a barrage of corporate earnings as the Federal Reserve kicked off its two-day policy meeting.

The Dow finished the session up 0.5% at 40,743.33 as it continues to claw its way back towards its record close of 41,198.08 set on 17 July. Meanwhile, the S&P 500 closed down 0.5% while the Nasdaq slumped 1.3%.

There was also a host of economic data to contend with on Tuesday. The average price of a single-family house rose by 5.7%. year-on-year in May, according to the Federal Housing Finance Agency, marking the slowest increase in ten months.

The Conference Board's July consumer confidence index came in ahead of expectations at 100.3, beating estimates for a reading of 99.7 but down from last month's print of 100.4.

Finally, US job openings were little changed at 8.18m in June, according to the Bureau of Labor Statistics, down from an upwardly revised reading of 8.23m in May but ahead of expectations for a print of 8.0m.