(Alliance News) - Stocks were marginally lower in early trade in London on Tuesday, with Plus500 rising after reporting improved trading but challenges have continued for Hunting.
The FTSE 100 index was down 11.72 points, or 0.2%, at 7,319.56.
The FTSE 250 was down 11.90 points, or 0.1%, at 20,198.26, and the AIM All-Share was 0.1% lower at 891.86.
The Cboe UK 100 index was up 0.2% at 12,438.16. The Cboe UK 250 was 0.6% higher at 18,140.67, and the Cboe UK Small Companies was 0.2% higher at 11,256.62.
In European equities, the CAC 40 index in Paris was down 0.1% and the DAX 30 in Frankfurt was flat.
In the FTSE 100, oil major BP was down 0.6% as it posted a replacement cost loss for the third quarter of 2019 of USD351 million, after a USD1.78 billion profit in the second quarter and USD3.09 billion in the third quarter last year.
On an underlying basis, BP's RC profit fell to USD2.25 billion, down 20% on a quarterly basis and 41% year-on-year. Replacement cost profit is BP's preferred metric of net income, and despite falling, the underlying figure has significantly beaten the market's expectations.
BP was hit by "significantly" lower earnings in the Upstream division on the back of lower commodity prices, maintenance work, and the impact of poor weather in the Gulf of Mexico. Downstream, BP said, had a "strong" quarter operationally.
Upstream production for the third quarter was 3.7 million barrels of oil equivalent per day, up from 3.6 million barrels a year before. However, underlying production, excluding BP's stake in Russia's Rosneft, fell 2.5%.
BP declared a 10.25 US cent dividend for the quarter while removing the scrip dividend alternative.
"Today's third-quarter numbers weren't expected to come in close to the levels seen in the second quarter given the decline in oil prices seen since then, however they still show a company that is nimbler and more efficient than it was a decade ago," said Michael Hewson at CMC Markets UK.
"Expectations were for income to come in at USD1.8 billion, however the numbers came in well above that at USD2.25 billion, confounding expectations of a much weaker quarter."
"The USD2.25 billion number was still well below that of the USD3.8 billion of a year ago, given oil prices are still below last year's levels, but it would appear better than expected downstream revenue has helped boost the numbers during the quarter," Hewson continued.
In the FTSE 250, contracts-for-difference trader Plus500 gained 7.5% as it reported a "strong improvement" in the third quarter compared to the second, with 18% quarterly revenue growth to USD110.6 million.
Year-on-year, Plus500's revenue increased 10%. Earnings before interest, taxes, depreciation, and amortisation rose 39% year-on-year to USD70.1 million.
The company reported 18% growth in new customers year-on-year, though compared to the second quarter new customer numbers fell 7%.
Plus500 said performance has benefited from "geopolitical events" which has led to heightened trading activity.
Oil field services firm Hunting, however, fell 3.3% as it said trading conditions in the third quarter continued to be challenging, especially due to a slowdown in US onshore completions.
As a result, Hunting said 2019 Ebitda is likely to be at the lower end of market expectations.
The core Hunting Titan business delivered third-quarter revenue and operating profit below the figures recorded in the first and second quarters of 2019.
Royal Mail was 4.3% lower in the FTSE 250, after JPMorgan cut its rating on the stock to Underweight from Neutral.
Sentiment elsewhere has been helped by developments in the US-China trade war. President Donald Trump again Monday said a trade deal is imminent with Beijing which will help American farmers hurt by retaliation in the grinding conflict between the economic powers.
"We're looking probably to be ahead of schedule to sign very a big portion of the China deal, and we will call it phase one," Trump told reporters.
The deal will "take care of the farmers" as well as "some of the other things" like banking, he said in another of his impromptu briefings before departing on a trip to Chicago.
Washington and Beijing have exchanged blows for over a year, with tariffs now impacting hundreds of billions of dollars in two-way trade.
Also in focus on Tuesday in the US will be the start of the US Federal Reserve's two-day monetary policy meeting, with the Fed expected to cut interest rates by a further 25 basis points.
In the US on Monday, Wall Street ended higher, with the Dow Jones Industrial Average closing up 0.5%, the S&P 500 0.6% higher, and the Nasdaq Composite 1.0% higher.
The Japanese Nikkei 225 index closed 0.5% higher on Tuesday. In China, the Shanghai Composite ended down 0.9%, while the Hang Seng index in Hong Kong finished 0.5% lower.
On the Brexit front, UK Prime Minister Boris Johnson is expected to call on members of Parliament once again to support his quest for a pre-Christmas election in order to break the Brexit deadlock.
Johnson has put his deal on hold in an anticipated bid to convince the Commons to vote on Tuesday for a December 12 election in his fourth time of asking.
But he may again be defeated with the date proving controversial for the Liberal Democrats and the SNP, who have signalled support for an election being held three days earlier.
The PM failed on Monday to get the two-thirds majority needed to secure an election under the Fixed-Term Parliaments Act, but was planning on a fresh attempt a day later.
The pound was quoted at USD1.2849 on Tuesday, soft compared to USD1.2861 at the close on Monday.
In the economic calendar there are UK mortgage approvals at 0930 GMT, Irish retail sales at 1100 GMT, and US consumer confidence at 1400 GMT.
By George Collard; georgecollard@alliancenews.com
Copyright 2019 Alliance News Limited. All Rights Reserved.
Hunting (HTG)
BP (BP.)
Plus500 (PLUS)