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(Alliance News) - Stock prices in London opened mixed on Tuesday, with supermarkets, BP and HSBC weighing on the FTSE 100, as earnings season in the UK ramps up.
The large-cap index was down 6.78 points, or 0.1%, at 5,840.01. The mid-cap FTSE 250 index was up 80.17 points, or 0.5%, at 16,033.13. The AIM All-Share index was up 0.5% at 799.33.
The Cboe UK 100 index was up 0.2% at 9,878.40. The Cboe 250 was up 0.5% at 13,802.25 and the Cboe Small Companies was up 0.2% at 8,908.68.
In mainland Europe, the CAC 40 in Paris was down 0.2%, while the DAX 30 in Frankfurt was flat early Tuesday.
"The mood was subdued on Tuesday morning, dealt a blow by a dire set of first-quarter results from BP," said Spreadex analyst Connor Campbell.
In the FTSE 100, BP was the worst performer down 2.9% after the oil major reported a sharp drop in first-quarter earnings as the oil and gas industry suffers from supply and demand shocks "on a scale never seen before".
For the quarter ended March 31, underlying replacement cost profit - BP's preferred metric - was USD0.8 billion, down 67% from USD2.4 billion for the same period a year earlier.
The result, BP said, reflected lower prices, sharply lower demand in the Downstream unit particularly in March, a lower estimated result from Russian partner Rosneft, and a lower contribution from oil trading.
BP swung to a replacement cost loss of USD0.6 billion from USD2.1 billion profit in the first quarter of 2019. BP said it was dealing with an "exceptionally challenging environment" and "demand destruction".
Looking ahead, BP is expecting "material impacts from Covid-19" in the second quarter.
WM Morrison Supermarkets was the worst-performing group, down 2.5% after the latest market share grocery figures from Kantar Worldpanel.
In the 12 weeks to April 19, Kantar said Morrisons's market share fell to 9.9% from 10.3% in the period.
J Sainsbury was down 1.5% after the grocer's market share fell to 15.3% from 15.4%. In addition, Berenberg cut the stock to Sell from Buy.
Tesco was down 1.2%. Kantar said the market share of the UK's largest supermarket chain fell to 26.8% from 27.3%.
Gaining a little market share - to 1.5% from 1.4% - was online delivery firm Ocado. The company's stock was up 0.2%.
Also gaining share in the UK was German discounter Lidl, up to 6.0% from 5.7%. German peer Aldi's share remained at 7.9%.
HSBC Holdings was down 1.5% after the Asia-focused lender reported a sharp drop in first-quarter profit as it upped its expected credit loss in the face of the Covid-19 pandemic.
The lender said it expects the global health crisis to hurt revenue in 2020 - due to lower customer activity - resulting in "materially" lower profit compared to 2019. For 2019, HSBC reported pretax profit of USD13.34 billion.
As a result, HSBC has been forced to up its expected credit loss by USD3.03 billion in the first quarter, from USD585 million a year before.
For the three months ended March, pretax profit dropped 48% to USD3.23 billion from USD6.21 billion a year prior. The figure missed the first-quarter company-compiled consensus estimate of USD3.66 billion.
HSBC's grim results set an ominous tone as bank earnings season in the UK gets underway. Barclays will report on Wednesday, Lloyds Banking on Thursday and Royal Bank of Scotland on Friday.
The Japanese Nikkei 225 index closed down 0.1%. In China, the Shanghai Composite closed down 0.2%, but the Hang Seng index in Hong Kong is up 0.9%.
Brent oil was quoted at USD19.12 a barrel Tuesday morning, lower than USD19.22 late Monday.
Crude prices continue to be hurt by concerns over collapsed demand and storage facilities filling up.
WTI, the US benchmark, plunged below USD11 a barrel early Tuesday, a day after it lost a quarter of its value, after a major exchange-traded fund started selling its short-term contracts of the commodity.
The US Oil Fund - a massive, oil-backed exchange-traded vehicle - said it would sell all its holdings in the June delivery and would buy into longer-dated contracts.
The pound was quoted at USD1.2416 early Tuesday, soft from USD1.2421 at the London equities close Monday.
The euro was at USD1.0824, soft from USD1.0836. Against the yen, the dollar was quoted at JPY107.26, flat from JPY107.21.
Gold was trading at USD1,694.62 an ounce, down from USD1,712.14.
The economic calendar on Tuesday has Irish retail sales at 1100 BST and US consumer confidence at 1500 BST.
By Arvind Bhunjun; arvindbhunjun@alliancenews.com
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