Rishi Sunak's appointment as Britain's prime minister boosted the pound
London (AFP) - Stock markets were mixed Tuesday as traders reacted to earnings reports, while Hong Kong steadied after the previous session’s rout triggered by China President Xi Jinping tightening his grip on power.
The pound climbed more than one percent as markets welcomed the appointment of former finance chief Rishi Sunak as Britain’s prime minister.
Sunak on Tuesday promised to bring economic stability after the turmoil that forced predecessor Liz Truss out of Downing Street.
“Right now our country is facing a profound economic crisis,” he told the nation in a televised address.
He vowed to place “economic stability and confidence at the heart of this government’s agenda”.
“This will mean difficult decisions to come,” Sunak added.
Some market support came from reports suggesting the Federal Reserve could slow its pace of interest rate hikes.
The central bank’s policy of ramping up US borrowing costs to fight decades-high inflation has hammered global markets this year as investors worry that they will send the economy into recession.
“Investors are getting more confident that inflation will soften as the consumer rethinks massive purchases,” said Edward Moya, analyst at Oanda trading group.
“Fed rate hike expectations will remain volatile, but expectations are growing that a weaker economy will let the Fed pause their tightening after the February policy meeting.”
It comes as investors pore over earnings updates from some of the world’s biggest companies.
Shares in HSBC slumped 6.3 percent after the banking giant warned on bad loans owing to global economic headwinds.
Elsewhere, shares in General Motors climbed 2.0 percent as the US automaker confirmed its full-year financial forecast despite a “challenging environment”, saying that consumer demand remained strong.
Third-quarter profits rose 37 percent to $3.3 billion on soaring revenues.
Shares in UPS and Coca-Cola were also trading higher after releasing earnings reports.
“Their gains are generating some offsetting support, yet there is a big earnings shadow that is hanging over the market and likely keeping investor enthusiasm in check this morning after the market’s big run,” said market analyst Patrick O’Hare at Briefing.com.
“That shadow is the earnings reports that will be heard after today’s close from Microsoft, Alphabet, and Visa,” he added, companies which outweigh those that reported today by market capitalisation several times over.
The Dow dipped 0.2 percent as Wall Street opened for trading, but both the S&P 500 and tech-heavy Nasdaq Composite moved higher.
Earlier Tuesday, US tech giant Meta resolved a major WhatsApp outage that prevented its popular service from connecting or sending messages.
Meta shares rose 2.8 percent.
In commodities trading meanwhile, European gas prices nudged back above 100 euros per megawatt hour, and global oil prices also edged higher.
- Key figures around 1330 GMT -
London - FTSE 100: DOWN 0.6 percent at 6,971.91 points
Frankfurt - DAX: DOWN 0.3 percent at 12,896.77
Paris - CAC 40: UP 0.7 percent at 6,173.20
EURO STOXX 50: UP 0.3 percent at 3,536.88
New York - Dow: DOWN 0.2 percent at 31,450.92
Tokyo - Nikkei 225: UP 1.0 percent at 27,250.28 (close)
Hong Kong - Hang Seng Index: DOWN 0.1 percent at 15,165.59 (close)
Shanghai - Composite: FLAT at 2,976.28 (close)
Pound/dollar: UP at $1.1423 from $1.1281 on Monday
Dollar/yen: DOWN at 148.05 yen from 148.95 yen
Euro/dollar: UP at $0.9931 from $0.9876
Euro/pound: DOWN at 86.91 pence from 87.56 pence
West Texas Intermediate: UP 0.4 percent at $84.94 per barrel
Brent North Sea crude: UP less than 0.1 percent at $93.33. per barrel