Last checked at 
(Alliance News) - Stock prices in London opened higher on Wednesday ahead of an interest rate decision by the US Federal Reserve and amid a busy day on the UK corporate earnings front.
The Federal Open Market Committee will conclude its two-day policy meeting on Wednesday and announce its decision at 1900 BST. This will be followed by a press conference with Fed Chair Jerome Powell at 1930 BST.
The US central bank is widely expected to announce a second successive 75 basis points increase to borrowing costs.
London stock indices were outperforming European counterparts early Wednesday.
The FTSE 100 was up 29.20 points, or 0.4%, at 7,335.48. The FTSE 250 index was up 16.11 points, or 0.1%, at 19,584.90. The AIM All-Share index was up 0.64 of a point, or 0.1%, at 899.16.
The Cboe UK 100 index was up 0.3% at 731.47. The Cboe 250 was up 0.1% at 17,060.12. The Cboe Small Companies was up 0.1% at 13,569.61.
In Paris, the CAC 40 stock index was down 0.4%, while in Frankfurt, the DAX 40 was 0.9% lower.
In Asia on Wednesday, the Japanese Nikkei 225 index closed up 0.2%. In China, the Shanghai Composite closed down 0.1%, while the Hang Seng index in Hong Kong was down 1.5%. The S&P/ASX 200 in Sydney ended up 0.2%.
In the FTSE 100, Reckitt Benckiser was the best performer, up 5.5%, after the hygiene and household goods maker raised its annual guidance following a positive first-half performance.
For the six months to June 30, the Slough, England-based firm swung to a pretax profit of GBP1.69 billion from loss of GBP1.94 billion last year, on revenue of GBP6.89 billion, up 4.4% from GBP6.60 billion.
Looking ahead, Reckitt said annual sales growth will be in a range of 5% to 8%, up from previous guidance of 1% to 4%. It also expects growth in its adjusted operating margins.
"We are already delivering sustainable mid-single digit net revenue growth and remain firmly on track to deliver our medium-term goal of mid-20s adjusted operating margins by the mid-2020s," Reckitt added.
Lloyds Banking was up 4.0% after the high street lender raised its annual guidance against a beneficial backdrop of rising UK interest rates.
For the six months to June 30, net income was GBP8.45 billion, up sharply from GBP7.56 last year, but pretax profit was GBP3.66 billion, down from GBP3.91 billion.
Lloyds said it set aside GBP377 million to cover a possible increase in loan defaults as UK interest rates rise to combat rampant inflation.
Underlying profit before the impairment was up 34% to GBP4.1 billion in the first half, driven by strong net income growth.
Lloyds's CET1 ratio - a key measure of a bank's financial strength - stood at 14.7% on June 30, down from 16.7% at the same time last year.
Turning to returns, Lloyds declared a 0.80p interim dividend, up 20% from last year and worth GBP550 million in total.
Looking ahead to 2022, Lloyds said its banking net interest margin is now expected to be greater than 280 basis points. It was 2.77% in the first half, up from 2.50% a year before.
Lloyds said its return on tangible equity is now seen at 13% in 2022. It was 13.2% in the first half, down from 19.2% a year ago.
Domestic rivals NatWest and Barclays were up 3.2% and 1.0% respectively in a positive read-across.
Legal & General was up 1.5% after Berenberg raised the insurer to 'buy' from 'hold'.
At the other end of the large-caps, Rio Tinto was the worst performer, down 3.5%. The Anglo-Australian miner slashed its first-half dividend, as earnings were dented by weaker iron ore prices.
Rio said it saw "significant movement" in the pricing for commodities in the half amid growing recession fears and a decline in consumer confidence.
For the six months to June 30, revenue fell to USD29.78 billion from USD33.08 billion last year, and pretax profit slumped to USD12.32 billion from USD18.05 billion.
Rio Tinto declared an interim dividend of 267.0 US cents, down 29% from 376.0 cents last year.
During the period, Rio said USD10.5 billion in net cash generated from operating activities, 23% lower than the 2021 first half - primarily driven by downward price movements for major commodities.
In June, Rio aid it made a USD1.1 billion final payment to the Australian Taxation Office in respect of 2021 profit. It also experienced a rise in working capital, mainly due to elevated prices for raw materials in aluminium inventory.
The miner said operations and growth projects continue to be hurt by the "high unplanned absences", tight labour markets, rising input costs and supply chain disruptions.
New York ended lower on Tuesday, with the Dow Jones Industrial Average down 0.7%, S&P 500 down 1.2%, and Nasdaq Composite down 1.9%.
Google-owner Alphabet on Tuesday recorded a second quarter profit fall, as it missed top- and bottom-line consensus.
In the second quarter to June 30, revenue improved 13% year-on-year to USD69.69 billion from USD61.88 billion. The revenue figure came in below a CNN-cited market forecast of USD69.9 billion. In addition, growth slowed markedly from a 62% surge in the second quarter of 2021.
Pretax profit declined 14% to USD19.01 billion from USD21.99 billion a year earlier. Basic earnings per share fell 12% to USD1.22 each, lagging a CNN-cited consensus of USD1.27.
Alphabet class A shares rose 4.9% in after-hours trade in New York.
Microsoft reported a strong rise in revenue in the final quarter of its financial year, thanks to continued strong Cloud services demand.
In the three months to June 30, revenue rose 12% to USD51.87 billion from USD46.15 billion a year before. Net income increased slightly to USD16.74 billion from USD16.46 billion. Diluted earnings per share improved to USD2.23 from USD2.17.
The stock rose 4.0% after-hours.
The pound was quoted at USD1.2050 early Wednesday, up from USD1.2021 at the London equities close Tuesday.
The euro was priced at USD1.0144, up from USD1.0120. Against the yen, the dollar was trading at JPY136.93, higher against JPY136.63.
Brent oil was quoted at USD104.67 a barrel Wednesday morning, down from USD105.24 late Tuesday. Gold stood at USD1,720.55 an ounce, firm against USD1,717.77.
By Arvind Bhunjun; arvindbhunjun@alliancenews.com
Copyright 2022 Alliance News Limited. All Rights Reserved.
