Source: Market Watch Personal Finance
U.K. blue-chip stocks dropped on Thursday as investors absorbed a flood of corporate earnings updates, with shares of Royal Dutch Shell PLC and Lloyds Banking Group PLC falling after their reports.
The FTSE 100
UKX, -0.44%
gave up 0.4% to end at 6,721.06, moving back from its best close since last August reached on Wednesday.
The prospect of a U.S. interest-rate increase was helping draw the London benchmark away from that 2016 high. Late Wednesday, the U.S. Federal Reserve kept the door open for an interest-rate hike in September, saying near-term risks to its outlook have diminished.
Read: What investors fleeing U.K. properties are getting wrong
Earnings roll in: Shell
RDSB, -2.54%
RDS.B, -3.30%
shares dropped 2.5% after the oil major posted a slide in second-quarter profit, saying “lower oil prices continue to be a significant challenge across the business, particularly in the upstream.” Shell’s adjusted earnings of $1.05 billion fell short of a $2.27 billion estimate drawn from a Wall Street Journal poll of analysts.
Lloyds
LLOY, -5.83%
shares fell 5.8% after the retail bank, which is about 9% owned by the U.K. government, warned that Brexit uncertainty could hurt the U.K. economy in the coming months. The bank is ramping up its cost-cutting efforts by axing 3,000 more jobs and closing roughly 200 branches. Lloyds swung to a profit of £1.59 billion ($24.19 billion) in the first half of the year.
The lender will also be in the spotlight on Friday evening when the European Banking Authority releases the results of its stress tests.
Smith & Nephew PLC
SN., -5.62%
slid 5.6% after the medical-equipment maker reported an 18% drop in first-half profit.
On the upside, Rolls-Royce Holdings PLC
RR., +13.52%
shares leapt 14% after the engine maker said it foresees a stronger performance in the final six months of the year. It posted a £1.8 billion ($2.37 billion) net loss in the first half of the year.
Shares of Anglo American PLC
AAL, +5.43%
pushed up 5.4% after the platinum, copper and diamond miner said it’s managed to pare down its hefty debt load. The company expects to sell $3 billion to $4 billion in assets this year as it continues to restructure. Anglo’s first-half net loss widened to $813 million.
The Pope, who traveled to Poland on Wednesday, spoke to reporters about the recent killing of an 85-year-old priest at a church in Normandy.
Source: Market Watch Personal Finance
The post FTSE 100 drops as Shell, Lloyds slump after earnings reports appeared first on The Money Street.