27th Oct 2026 07:03
(Alliance News) - Stocks in London are set to open lower on Tuesday as investors digest quarterly results from market heavyweight HSBC, while monitoring diplomatic efforts to ease tensions in the Middle East.
IG says futures indicate the FTSE 100 index to open 56.4 points lower, 0.5%, at 10,710.93 on Tuesday. The index of London large-caps closed up 0.7% at 10,767.33 on Monday.
Sterling was quoted at USD1.3327 early Tuesday, lower than USD1.3353 at the London equities close on Monday. Against the euro, sterling was up marginally to EUR1.1941 from EUR1.1940 a day prior.
HSBC maintained its dividend and announced a new share buyback programme after reporting strong third-quarter profit growth in 2026.
The Asia-focused, London-based bank said pretax profit jumped 32% to USD9.63 billion in the three months ended September 30 from USD7.30 billion a year earlier. Diluted and basic earnings per share rose 46% to USD0.41 from USD0.28.
HSBC maintained its third-quarter dividend at USD0.10 per share and announced plans for a new USD1 billion share buyback programme, which it aims to complete before the end of 2026.
Net operating income increased 6.0% to USD17.79 billion from USD16.78 billion a year earlier. Net interest income rose 6.0% to USD9.31 billion from USD8.78 billion, while net fee income climbed 1.7% to USD3.57 billion from USD3.51 billion.
Group Chief Executive Georges Elhedery said: "Our performance shows that in a more complex world clients continue to turn to us to navigate uncertainty and seize new opportunities."
"It also reflects consistent execution of our strategic priorities with pace, precision and discipline. As we simplify HSBC, we are creating greater capacity to invest, grow and deliver strong returns for our shareholders."
HSBC kicked off a week of third-quarter earnings reports from major UK and European banks, including fellow Asia-focused lender Standard Chartered on Wednesday. Lloyds Banking follows on Thursday.
Despite the sharp increase in profit, its shares fell 5.6% in Hong Kong, putting the lender in focus ahead of the London market open.
The euro traded at USD1.1161 early Tuesday, lower than USD1.1183 late Monday. Against the yen, the dollar was quoted at JPY157.78 versus JPY157.53.
Brent oil was trading at USD115.84 a barrel early Tuesday, lower than USD117.02 late Monday.
Meanwhile, senior officials from Saudi Arabia, Turkey and Pakistan held talks with Iran in an effort to prevent a renewed escalation of the Middle East war, with Tehran describing the discussions as "very good".
Officials from the three countries travelled to Iran as part of efforts to "de-escalate between the parties to the current crisis", according to a Saudi foreign ministry statement.
The talks, which included Saudi Defence Minister Prince Khalid bin Salman, followed warnings from the US, Iran and Israel that hostilities could resume in the eight-month conflict.
It marked the first joint visit to Tehran by representatives of Pakistan, Saudi Arabia and Turkey since the three countries formed a defence alliance in Mecca in August.
The delegations met Iranian President Massoud Pezeshkian and Foreign Minister Abbas Araghchi.
The meeting ended without concrete announcements, although the parties "agreed to continue discussions", according to Iranian state media.
Back in the UK, Downing Street said Prime Minister Andy Burnham was "not leaning either way" on Britain's future relationship with the European Union, following his call over the weekend for an "honest discussion" about restoring freedom of movement.
The comments have prompted questions about the government's plans to deepen ties with Brussels, including whether a potential return to freedom of movement could be put to a referendum.
Number 10 denied backtracking after Burnham left open the possibility of a public vote. A Downing Street spokeswoman said the government was "not at that stage yet" when asked whether voters would decide on closer EU ties through a referendum or an updated Labour manifesto.
Home Secretary Shabana Mahmood told the Commons on Monday that Burnham's call for an honest discussion was "not the same as settled policy".
"The prime minister has also observed that there were very significant issues with freedom of movement when we were within the EU," she said.
"An honest debate means actually being honest about all of the aspects of that debate and not cherry-picking."
In the US on Monday, Wall Street ended higher, with the Dow Jones Industrial Average up 0.3%, the S&P 500 up 0.7% and the Nasdaq Composite up 0.9%.
In Asia on Tuesday, the Nikkei 225 index in Tokyo was up 0.3%. In China, the Shanghai Composite rose 0.7%, while the Hang Seng index in Hong Kong gained 0.8%. The S&P/ASX 200 in Sydney was up 0.5%.
Gold was quoted at USD3,999.91 an ounce early Tuesday, lower than USD4,017.92 on Monday.
In the economic calendar on Tuesday, the eurozone releases money supply figures, while Ireland publishes wholesale price data.
In the US, building permits, durable goods orders, the Redbook retail sales index, the S&P/Case-Shiller home price index, the Federal Housing Finance Agency house price index, Conference Board consumer confidence, the Richmond Fed manufacturing index and new home sales figures are due.
The US Federal Open Market Committee also begins its two-day monetary policy meeting.
By Eva Castanedo, Alliance News senior economics reporter
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