FTSE 100 LIVE: Stocks lack direction as UK shop price inflation slows

The FTSE 100 (^FTSE) and European stocks were lacklustre on Tuesday morning as UK shop price inflation slowed in October. This was despite a sharp rise in fresh food prices driven by beef, poultry and fruits, according to the latest figures from the British Retail Consortium and NielsenIQ.

Fresh food inflation rose to 4.3% year-on-year this month, compared with 4.1% in September.

Overall food inflation slowed to 3.7% during the month, versus growth of 4.2% the month before, although prices remain elevated.

The decrease was in part due to an easing of global sugar prices, which helped bring down costs for consumers buying chocolates and confectionery.

Clive Black at Shore Capital said the "welcome" easing in food prices has implications for interest rates, and may assist with a cut from the Bank of England "sooner rather than later".

With UK wage growth remaining at over 4%, he said, "the real affordability of food remains sound, noting that if the British want better...they should expect to pay more".

London’s benchmark index (^FTSE) was muted in early trade, hovering around the flatline Germany's DAX (^GDAXI) dipped 0.4% and the CAC (^FCHI) in Paris headed 0.3% into the red The pan-European STOXX 600 (^STOXX) was down 0.3% Wall Street is set for a negative start as S&P 500 futures (ES=F), Dow futures (YM=F) and Nasdaq futures (NQ=F) were all in the green. The pound was 0.25% down against the US dollar (GBPUSD=X) at 1.3304

FTSE Index - Delayed Quote•USD

(^FTSE)

Follow View Quote Details

9,657.52

+3.70

+(0.04%)

As of 9:20:00 AM GMT. Market Open. Advanced Chart

Follow along for live updates throughout the day:LIVE3 updates

11 mins ago

LaToya Harding

HSBC profits fall 14% after bank flags $1.1bn hit from Madoff lawsuit

HSBC's (HSBA.L) pre-tax profits fell 14% in the third quarter, after the bank set aside a $1.1bn (£824m) provision for a lawsuit tied to Bernard Madoff's Ponzi scheme.

Profit before tax for the quarter came in at $7.29bn, which was below expectations of $7.65bn, according to consensus estimates provided by the bank.

HSBC said that reduction reflected an increase in operating expenses, mainly from notable items in the third quarter, including legal provisions of $1.4bn.

The bank flagged on Monday that it had put aside a $1.1bn provision for costs stemming from a long-running lawsuit brought by investors who lost money in Madoff's investment fraud scheme.

In the lawsuit, which dates back to 2009, HSBC Securities Services Luxembourg (HSSL) is defending a claim brought by Herald Fund SPC for restitution of securities and cash.

On Friday, the Luxembourg Court of Cassation denied HSSL's appeal over Herald's securities restitution claim but accepted its appeal over the cash restitution claim. HSSL will pursue a second appeal before the Luxembourg Court of Appeal.

HSBC reported profit after tax of $5.5bn for the third quarter, which was 18% down on the same period last year and was lower than estimates of $5.97bn.

However, revenue of $17.79bn was up 5% on the third quarter of last year and beat expectations of $16.72bn.

Net interest income – the difference between what the bank pays out to savers and receives from borrowers in interest – of $8.78bn was 15% higher than the same quarter last year.

Read our full article here 36 mins ago

LaToya Harding

Asia and US overnight

Stocks in Asia were lower overnight as traders digested Donald Trump’s visit to Japan ahead of his high-stakes talks with Chinese President Xi Jinping later this week.

The Nikkei (^N225) fell 0.6% on the day in Japan, after surging above 50,000 points on Monday for the first time, while the Hang Seng (^HSI) fell 0.3% in Hong Kong.

The Shanghai Composite (000001.SS) was 0.2% down by the end of the session and in South Korea, the Kospi (^KS11) lost 0.8% on the day.

It comes as Trump met new Japanese prime minister Sanae Takaichi yesterday, declaring that the United States was “an ally at the strongest level”.

The White House announced that the countries had signed an agreement on the supply of rare earths, a critical sector dominated by China that has deepened the antipathy between Washington and Beijing.

Takaichi also said Japan was facing an “unprecedented severe security environment”, in a nod to the geopolitical tensions underlying Trump’s Asia tour.

The US president is due to meet his Chinese counterpart Xi Jinping on Thursday in South Korea.

Across the pond, the S&P 500 (^GSPC) rose 1.2% to 6,875.16, and the tech-heavy Nasdaq (^IXIC) was 1.9% higher, ending at 23,637.46. The Dow Jones (^DJI) also gained 0.7% to close at 47,544.59.

In the bond market, the yield on 10-year US Treasury notes, which influence interest rates around the world, fell to 3.979%, from 4.029% late on Sunday.

Nasdaq GIDS - Delayed Quote•USD

(^IXIC)

Follow View Quote Details

23,637.46

+432.59

+(1.86%)

At close: October 27 at 5:15:59 PM EDT Advanced Chart 54 mins ago

LaToya Harding

Coming up

Good morning, and welcome back to our markets live blog. As usual we will take a deep dive into what's moving markets and what's happening across the global economy.

Here's a snapshot of what's on the agenda:

7am: HSBC, Anglo American, Airtel Africa, C&C Group, RWS, Auction Technology, Valterra Platinum, Evoke 9am: Italy business and consumer confidence for October

Download the Yahoo Finance app, available for Apple and Android.

View Comments