U.K. stocks advanced, following a four-week rally in the FTSE 100 Index, as HSBC Holdings Plc posted 30 percent growth in quarterly profit and investors awaited a European Central Bank policy meeting this week.
HSBC added 2.3 percent, contributing the most to a gain in the benchmark measure. Antofagasta Plc and Rio Tinto Group each climbed more than 3 percent. Ryanair Holdings Plc tumbled the most in more than five years in Dublin after forecasting a drop in full-year profit. Weir Group Plc slid the most in four months after saying currency swings will cut earnings.
The FTSE 100 rose 28.88 points, or 0.4 percent, to 6,763.62 at the close in London. The gauge jumped 4.4 percent in the past four weeks as U.S. lawmakers agreed to end a fiscal impasse and the Federal Reserve decided to maintain the pace of its stimulus. The broader FTSE All-Share Index also climbed 0.4 percent today, while Ireland’s ISEQ Index slipped 0.6 percent.
“In the summer, everyone was bullish about Europe and now people are saying the economy’s not great,” Gerard Lane, a strategist at Shore Capital Group Ltd. in Liverpool, England, said by phone. “The ECB might indicate concern about the sluggishness of the pace of growth in Europe. In the U.K., the economy is growing very robustly and the growth next year is likely to be much stronger than people are expecting.”
The ECB will announce its interest-rate decision on Nov. 7. Bank of America Corp., UBS AG and Royal Bank of Scotland Group Plc predict the central bank will cut its benchmark rate from a record low of 0.5 percent. Still, 65 of the 68 economists surveyed by Bloomberg forecast no change.
The Confederation of British Industry, a U.K. business lobby, said in a quarterly report that it expects the economy to expand 1.4 percent this year and 2.4 percent in 2014. That compares with its August forecast of 1.2 percent in 2013 and 2.3 percent next year. It also estimated unemployment will fall to
7.2 percent at the end of 2015 from its current 7.7 percent.
HSBC advanced 2.3 percent to 703 pence, its biggest increase since Sept. 5. Europe’s largest bank said pretax profit rose to $4.53 billion in the third quarter, from $3.48 billion a year earlier. Costs fell to 61 percent of revenue from 64 percent, the bank said.
Antofagasta, which owns copper mines in Chile, climbed 3.2 percent to 863.5 pence. Rio Tinto, the world’s second-biggest commodity producer, gained 3.3 percent to 3,289.5 pence. Fresnillo Plc, a gold and silver producer, added 4.5 percent to 1,001 pence. A gauge of mining companies was the best performer among the 19 industry groups in the Stoxx Europe 600 Index, the regional benchmark.
Ryanair tumbled 13 percent to 5.33 euros, its biggest drop since July 2008, after Europe’s biggest discount airline revised its earnings outlook for the second time in two months. Profit for the year ending March 31 will be 500 million euros ($675 million) to 520 million euros, compared with last year’s 569 million euros, the company said. Ryanair said in September that net income will be about 570 million euros and may be even lower if fare yields continued to worsen.
EasyJet Plc, Europe’s second-biggest discount airline, lost
5.1 percent to 1,230 pence. A gauge of travel and leisure shares posted the worst performance in the Stoxx 600.
Weir slid 3.7 percent to 2,173 pence, its biggest slide since July 3. The U.K.’s biggest supplier of pressure pumps said weakness in the U.S., Australian and emerging-market currencies will reduce full-year profit by as much as 12 million pounds.