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(Alliance News) - Stocks in London ended mostly higher on Thursday on a busy day of corporate earnings, with robust numbers from Standard Chartered giving the FTSE 100 a boost.
The FTSE 100 index closed up 83.58 points, or 1.1%, at 7,509.19. The mid-cap FTSE 250 index ended up 181.85 points, or 0.9%, at 20,619.62. The AIM All-Share index closed down 2.10 points, or 0.2%, at 1,014.36.
The Cboe UK 100 index ended up 0.8% at 746.55. The Cboe 250 closed up 0.5% at 18,158.68, and the Cboe Small Companies ended up 0.2% at 15,110.84.
In mainland Europe, the CAC 40 stock index in Paris closed up 1.0%, while the DAX 40 in Frankfurt ended up 1.4%.
"Some decent earnings reports have given the FTSE 100 a welcome lift today, although the market reaction to some has been a little bit underwhelming, which is causing the rebound on the UK index to lag its European peers," said CMC Markets analyst Michael Hewson. "Banks are doing well helped by some solid numbers from Standard Chartered, while Barclays numbers have been a mixed bag."
In the FTSE 100, Standard Chartered ended the standout performer, up 14%, after the emerging markets-focused lender upped its annual income growth outlook after a stellar first quarter.
In the three months to March 31, Asia-focused StanChart recorded pretax profit of USD1.49 billion, up 6% from USD1.41 billion reported in the same period the year prior. The bank started to build credit reserves once again, booking USD197 million in credit impairments in the first quarter, sharply higher from USD17 million the year before.
Operating income rose 9% to USD4.29 billion from USD3.94 billion. Net interest income rose 8% to USD1.79 billion from USD1.66 billion, while 'other' income was 10% higher at USD2.50 billion from USD2.28 billion.
Whitbread closed up 4.3% after the hospitality firm reported a swing to annual profit, on a strong recovery from the worst of the pandemic, with the Premier Inn owner also reinstating its payout.
The Dunstable, England-based company swung to a pretax profit of GBP58.2 million in the year to March 3, from a loss of GBP1.01 billion a year earlier. This was on revenue that more than doubled to GBP1.70 billion from GBP589.4 million.
Encouraged by its strong set of results, Whitbread reinstated its dividend with a final payout of 34.7 pence per share.
Barclays closed up 3.1% even posting a drop in first-quarter profit as the bank started to rebuild credit impairments and felt the hit from over-selling certain securities to US investors.
In the three months to March 31, Barclays recorded pretax profit of GBP2.23 billion, slipping from GBP2.40 billion in the same period the year prior. The bank set aside GBP141 million in credit impairment charges, up sharply from GBP55 million the year before.
Total group operating costs increased to GBP3.59 billion from GBP3.55 billion, with the bank including about GBP540 million of conduct charges following the over-issuance of securities by Barclays Bank PLC in the US.
Unilever closed up 2.7% despite the consumer goods firm warning on annual margins, as it predicts costs will be chunkier than expected in the second half of 2022.
For the first-quarter of 2022, Unilever's revenue increased 12% year-on-year to EUR13.78 billion from EUR12.33 billion. Underlying sales growth was 7.3%, with prices rising 8.3% but volumes falling 1.0%.
"We are executing well in a very challenging input cost environment," Chief Executive Alan Jope commented.
Unilever on Thursday said second-half costs will be higher than initially expected, at around EUR2.7 billion.
"We read this as a positive update given extreme bearish sentiment and low relative valuation," said Jefferies analyst Martin Deboo.
At the other end of the large-caps, J Sainsbury ended the worst performer, down 4.3%, after the supermarket chain warned of a weaker bottom line going forward due to accelerating inflation and costing of living pressures impacting disposable income.
The London-based grocer swung to a pretax profit of GBP854 million in the year ended March 5. The previous year, Sainsbury's posted a pretax loss of GBP164 million. The grocer reported underlying pretax profit of GBP730 million, more than doubled from GBP357 million in financial 2021 and up 25% from GBP586 million in financial 2020.
The underlying profit figure topped company-compiled consensus of GBP727 million, as well as the company's own guidance of GBP720 million. This was driven by continued elevated sales, lower Covid-19 costs and falling finance costs, it explained. Sainsbury's expects underlying pretax profit to fall as much as 14% in the new financial year. It forecasts underlying pretax profit between GBP630 million and GBP690 million.
Fresnillo closed down 3.6% after the stock went ex-dividend meaning new buyers no longer qualify for the latest payout.
St James's Place closed down 2.8% after the wealth manager recorded a drop in funds under management over the first quarter.
The fund manager ended the first quarter with funds under management of GBP151.25 billion, rising sharply from GBP135.46 billion at the same point the year prior. SJP ended 2021 with GBP153.99 billion in funds under management. The stock also went ex-dividend.
In the FTSE 250, Spectris ended the best performer, up 9.2%, after the precision instrument maker said it has made a strong start to 2022 with sales growth and a strengthening order book in the first quarter.
The pound was quoted at USD1.2458 at the London equities close, down from USD1.2509 at the close Wednesday.
Sterling fell to an intraday low of USD1.2437 against the dollar - its lowest level since mid-2020 - amid growing concerns the Bank of England will keep interest rates on hold at its policy meeting next week.
"Markets are expecting too much tightening from the Bank of England and are slowly waking up to a less hawkish reality. This means gilts will struggle to follow Treasury and Bund yields higher, and the curve should price out hikes. Sterling has started to react to the weaker consumer data and, barring a very hawkish surprise, risks look skewed to the downside," said analysts at ING.
The euro stood at USD1,0524 at the European equities close, unmoved from USD1.0525 late Wednesday.
Against the yen, the dollar was trading at JPY131.00, up sharply from JPY128.45 late Wednesday. Versus the Japanese currency, the dollar hit an intraday high of USD131.09 in early trade - a level not seen since April of 2002 - after the Bank of Japan on Thursday kept interest rates unchanged.
New York was slightly higher at the London equities close as tech earnings season continues in earnest. The DJIA was up 0.1%, the S&P 500 index up 0.2% and the Nasdaq Composite up 0.1%.
On Wall Street, Meta Platforms was up 12% after the Facebook parent reported better profit than expected in the recently ended first quarter.
Meta said it made a profit of USD7.5 billion on revenue of USD27.9 billion in the first three months of this year, calming fears over intensifying competition from TikTok.
The average number of people using Facebook monthly rose 3% to 2.94 billion by the end of March, while around 3.64 billion people used at least one member of Meta's family of apps each month, the tech company reported.
Ahead, trillion-dollar tech firms Apple and Amazon will report earnings after the market close in New York.
Brent oil was quoted at USD106.55 a barrel at the equities close, up from USD105.34 at the close Wednesday.
Gold stood at USD1,887.75 an ounce at the London equities close, slightly higher against USD1,885.50 late Wednesday.
The economic events calendar on Friday has China manufacturing PMI overnight, UK Nationwide house price index print at 0700 BST, eurozone economic growth figures at 1000 BST and US personal income data at 1330 BST. Financial markets in Japan are closed on Friday for the Showa Day holiday.
The UK corporate calendar on Friday has first-quarter results from Anglo-Swedish drugmaker AstraZeneca, household goods firm Reckitt Benckiser, education publisher Pearson and state-backed lender NatWest Group.
By Arvind Bhunjun; arvindbhunjun@alliancenews.com
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