London open: Stocks fall amid earnings barrage, despite more dovish Fed

(Sharecast News) - London stocks were a little weaker in early trade on Thursday, unable to hold on to opening gains despite a less hawkish stance from the US Federal Reserve, amid a barrage of corporate news. At 0925 BST, the FTSE 100 was down 0.3% at 7,323.74.

Overnight, the FOMC raised the Fed Funds target by 0.75% to a target range of 2.25%-2.50%, as expected. But investors breathed a sigh of relief after Chair Jerome Powell hinted that the US central bank could slow the pace of rate hikes and adopt a meeting-by-meeting approach.

Victoria Scholar, head of investment at Interactive Investor, said: says: "European markets have opened on a stronger footing thanks to risk-on sentiment across global markets after the Fed suggested that the pace of rate increases could slowdown in the months ahead while lifting rates by 75 basis points.

"Fed Chair Jay Powell's comments lead to a surge in the Nasdaq which closed up by more than 4%. However after-hours Meta shares slumped on disappointing quarterly revenue numbers.

"It is another mega day for corporates with earnings from FTSE 100 heavyweights Shell and Barclays while tech behemoths Apple and Amazon deliver their quarterly scorecards after the bell. Economic data is also centre stage stateside with investors paying close attention to key US GDP and PCE price data out today."

In equity markets, medical technology group Smith & Nephew slid after it posted a drop in first-half pre-tax profit.

Airtel Africa was also in the red after first-quarter results, along with BT Group.

Barclays fell as it reported a decline in half-year pre-tax profits due to higher costs and a £300m impairment provision for bad debts amid the cost-of-living crisis. The bank said pre-tax profits fell 24% to £3.7bn. Group income was £13.2bn, up 17% year-on-year, including £800m from hedging arrangements related to the over-issuance of securities.

Credit impairment charges were £300m compared with a £700m release of cash last year that had been set aside for debts expected during the Covid pandemic.

CMC Markets tumbled after the online trading platform said operating costs were set to be 5% higher than initially expected.

On the upside, miners rallied, with Anglo American also in the black despite reporting a 28% fall in first-half earnings.

Smurfit Kappa got a boost after JPMorgan Cazenove lifted its price target on the shares.

Shell gushed a little higher after the oil giant reported a better-than-expected second-quarter profit of $11.5bn, driven by soaring energy prices.

National Express, Hammerson, Weir and DiscoverIE also lost ground after updates.

Market Movers

FTSE 100 (UKX) 7,323.74 -0.33% FTSE 250 (MCX) 19,727.31 0.45% techMARK (TASX) 4,304.72 -1.36%

FTSE 100 - Risers

Anglo American (AAL) 2,907.50p 4.77% Schroders (SDR) 2,852.00p 4.47% Smurfit Kappa Group (CDI) (SKG) 2,957.00p 3.75% Fresnillo (FRES) 679.40p 3.66% Smith (DS) (SMDS) 285.60p 3.14% Ashtead Group (AHT) 4,270.00p 3.02% Rentokil Initial (RTO) 517.40p 2.90% Antofagasta (ANTO) 1,109.50p 2.83% Rio Tinto (RIO) 4,916.50p 2.68% Intermediate Capital Group (ICP) 1,448.00p 2.30%

FTSE 100 - Fallers

Smith & Nephew (SN.) 1,075.00p -10.75% Aveva Group (AVV) 2,139.00p -8.20% Airtel Africa (AAF) 157.10p -8.07% BT Group (BT.A) 163.40p -7.21% SSE (SSE) 1,676.00p -5.82% British American Tobacco (BATS) 3,358.00p -2.64% Barclays (BARC) 153.62p -2.56% National Grid (NG.) 1,086.50p -2.25% Vodafone Group (VOD) 118.80p -1.83% AstraZeneca (AZN) 10,786.00p -1.61%

FTSE 250 - Risers

National Express Group (NEX) 195.70p 9.27% Hammerson (HMSO) 23.34p 7.91% Weir Group (WEIR) 1,591.00p 6.96% Hochschild Mining (HOC) 77.40p 6.91% Ferrexpo (FXPO) 152.70p 5.89% Discoverie Group (DSCV) 723.00p 5.70% Wood Group (John) (WG.) 156.70p 3.57% Inchcape (INCH) 813.50p 3.50% Molten Ventures (GROW) 457.40p 3.39% ASOS (ASC) 1,069.00p 3.29%

FTSE 250 - Fallers

CMC Markets (CMCX) 247.00p -19.81% Royal Mail (RMG) 278.90p -3.09% Mitchells & Butlers (MAB) 170.40p -3.07% Drax Group (DRX) 743.50p -2.94% Bytes Technology Group (BYIT) 421.20p -2.73% The Global Smaller Companies Trust (GSCT) 141.00p -2.49% Rathbones Group (RAT) 1,828.00p -2.35% QinetiQ Group (QQ.) 373.80p -2.10% Provident Financial (PFG) 185.00p -1.91% VinaCapital Vietnam Opportunity Fund Ltd. (VOF) 481.50p -1.73%