28th Apr 2022 08:59
(Alliance News) - The mood in equity markets was upbeat early Thursday, after Facebook-parent Meta Platforms calmed US tech sector nerves overnight with a well-received quarterly report.
Meta's numbers came ahead of similar updates from Amazon and Apple later on Thursday. In the UK, meanwhile, Standard Chartered's first-quarter report impressed, while shares in J Sainsbury dropped after the grocer warned of cost pressures.
The FTSE 100 index was up 60.27 points, or 0.8%, at 7,485.88 early Thursday. The mid-cap FTSE 250 index was up 181.98 points, or 0.9%, at 20,619.75. The AIM All-Share index was up 0.71 of a point, or 0.1%, at 1,017.17.
The Cboe UK 100 index was up 0.6% at 744.95. The Cboe 250 was up 0.7% at 18,164.37. The Cboe Small Companies climbed 0.2% to 15,105.63.
In mainland Europe, the CAC 40 in Paris jumped 1.8% and the DAX 40 in Frankfurt rose 1.4% early Thursday.
Equities in Asia also were higher on Thursday. The Nikkei 225 in Tokyo rose 1.8%, while the S&P/ASX 200 in Sydney added 1.3%. The Shanghai Composite closed up 0.6%. The Hang Seng in Hong Kong was 1.4% higher in late trade.
"Equity markets are higher in Asia today as US index futures rally after Meta managed to post minuscule growth in user numbers overnight along with robust financials," Oanda analyst Jeffrey Halley commented.
Standard Chartered was the best large-cap performer in London, surging 12%.
The Asia-focused bank upped its annual income growth outlook.
In the three months to March 31, StanChart recorded pretax profit of USD1.49 billion, up 6% from USD1.41 billion reported in the same period a year prior.
Operating income rose 9% to USD4.29 billion from USD3.94 billion. Net interest income rose 8% to USD1.79 billion from USD1.66 billion, while 'other' income was 10% higher at USD2.50 billion from USD2.28 billion.
StanChart now expects income growth "slightly" ahead of its previously guided 5% to 7% range.
Shares in peer Barclays climbed 1.6%, even though the bank reported a first-quarter profit fall amid chunkier impairment costs as well as "conduct" charges.
Barclays posted pretax profit of GBP2.23 billion for the first quarter of 2022, down 6.9% annually from GBP2.40 billion. Credit impairment charges increased to GBP141 million from GBP55 million.
Profit also was hurt by "litigation and conduct charges". These amounted to GBP500 million. The costs relate to "customer remediation costs" from a legacy loan portfolio, as well as a previously announced GBP450 million hit after Barclays sold more financial products to investors in the US than it was allowed to.
The bank's total income increased 10% year-on-year to USD6.50 billion from GBP5.90 billion.
Barclays said it remains "committed" to a share buyback of GBP1 billion. The programme was delayed back in March, after it announced it had over-issued structured notes and exchange traded notes to US investors.
"On the whole, Barclays has had a strong start to the year, although the fine relating to over-issuance of securities in the US has punched something of a hole in profits," Interactive Investor analyst Richard Hunter commented.
Sainsbury's was the worst large-cap performer, falling 6.4%.
The supermarket chain posted underlying pretax profit of GBP730 million for the financial year that ended March 5, more than doubled from GBP357 million in financial 2021 and up 25% from GBP586 million in financial 2020. Profit in financial 2021 was hurt by GBP485 million in incremental costs related to Covid-19.
The underlying profit figure topped company-compiled consensus of GBP727 million, as well as the company's own guidance of GBP720 million.
Sainsbury's swung to a statutory pretax profit of GBP854 million from a GBP164 million loss. Revenue, excluding VAT but including fuel, was 2.9% higher at GBP29.90 billion from GBP29.05 billion.
In addition, Sainsbury's hiked its dividend by 24% to 13.1 pence per share from 10.6p.
However, it warned: "The year ahead will be impacted by significant external pressures and uncertainties, including higher operating cost inflation and cost of living pressures impacting customers' disposable incomes."
Sainsbury's expects underlying pretax profit to fall by as much as 14% in the new financial year. It forecasts underlying pretax profit between GBP630 million and GBP690 million.
Lancashire Holdings jumped 10%.
The insurer said gross written premiums in the first quarter of 2022 rose 35% annually to USD477.9 million.
It also estimated a hit between USD20 million and USD30 million stemming from the war in Ukraine.
Elsewhere in London, HSS Hire was a notable AIM performer. The stock rose 6.8%.
The equipment rental firm's revenue in the financial year ended January 1 climbed 21% to GBP303.3 million from GBP250.1 million. HSS swung to a pretax profit of GBP6.1 million from a GBP29.6 million loss.
Over in Frankfurt, HelloFresh shares surged 9.2%. It said first-quarter revenue and adjusted earnings before interest, tax, depreciation and amortisation will top market expectations.
The meal-kit maker expects revenue for the first quarter of EUR1.92 billion, up 26% year-on-year at constant currency.
Its adjusted Ebitda is expected to fall 38% year-on-year to EUR99.3 million, though the figure will top market forecasts.
The Bank of Japan on Thursday kept interest rates unchanged and believes the Japanese economy is on the mend, but warned of "downward pressure" stemming from Russia's invasion of Ukraine.
At the April meeting, the BoJ decided by an 8-1 majority vote to keep a negative interest rate of 0.1% - recording the same result from its March meeting - with the lone dissenter being Kataoka Goushi.
Against the yen, the dollar climbed to JPY130.31 early Thursday UK time, from JPY128.45 at the time of the London equities close on Wednesday.
"The Japanese yen has fallen sharply this morning after the BoJ policy announcement that gave no indication of support for the currency. It has depreciated by around 13% against the US dollar so far this year," analysts at Lloyds Bank commented.
The pound rose to USD1.2563 early Thursday from USD1.2509 late Wednesday. The euro stood at USD1.0538, up from USD1.0525.
Brent oil was quoted at USD104.75 a barrel early Thursday in London, down from USD105.34 late Wednesday. Gold stood at USD1,885.16 an ounce, largely flat from USD1,885.50.
The economic events calendar on Thursday has Germany inflation data at 1300 BST and US GDP at 1330 BST.
By Eric Cunha; [email protected]
Copyright 2022 Alliance News Limited. All Rights Reserved.
Related Shares:
Hss HireStandard CharteredBarclaysSainsbury'sLancashire Holdings