London stocks were mixed at midday on Tuesday, with the FTSE 100 falling 0.8% as sharp losses for HSBC and Reckitt Benckiser weighed on the blue-chip index, while investors positioned themselves ahead of Wednesday’s Autumn Budget.
The FTSE 100 dropped 82.35 points to 10,684.98, reversing much of Monday’s advance. However, the FTSE 250 gained 0.5% to 24,626.01, while the AIM All-Share edged 0.2% higher to 754.58.
European markets performed better, with France’s CAC 40 up 0.4% and Germany’s DAX up 0.3%, while London’s largest companies posted mixed results.
HSBC was the biggest source of pressure on the FTSE 100, plunging 7.5% after its latest quarterly results failed to meet market expectations despite a substantial increase in profits.
The Asia-focused banking giant reported a 32% increase in third-quarter pre-tax profit to $9.63 billion, compared with $7.30 billion a year earlier.
However, weaker-than-expected income disappointed investors, overshadowing the bank’s decision to maintain its quarterly dividend at $0.10 per share and launch a further $1 billion share buyback programme.
Reckitt Benckiser fell 4% after lowering its full-year sales growth forecast, citing manufacturing constraints in North America and slower demand for vitamins and supplements in China.
The consumer goods group now expects 2026 like-for-like revenue growth of 3.5% to 4.5% across its core business, following a weaker-than-anticipated third quarter.
Reported quarterly revenue declined 6.9% to £3.36 billion, although like-for-like sales increased 3.2%.
The company highlighted production difficulties affecting its Lysol cleaning products in the United States, alongside softer growth in China’s vitamins, minerals and supplements market.
Despite weakness among major consumer and banking stocks, several FTSE 100 companies attracted buyers.
Rentokil Initial climbed 2.2% after launching a $200 million share buyback programme, while copper producer Antofagasta advanced 1.6% following an upgrade to ‘hold’ from Deutsche Bank Research.
Among mid-cap companies, Vistry Group rose 3.8% after appointing Severn Trent finance chief Helen Miles as its next Chief Financial Officer.
Miles is expected to join the housebuilder during 2027, while Robert Allen has been appointed interim CFO and board director with immediate effect.
Severn Trent shares slipped 0.6% following the announcement.
Zenith Energy jumped 9.2% among smaller companies after appointing former US Secretary of State Mike Pompeo and his advisory firm, CNQ Global Advisors, as strategic advisers in connection with a $573 million international arbitration claim against Tunisia.
The appointment attracted investor attention as the company continues pursuing compensation through international legal proceedings.
Elsewhere, Shoe Zone shares plunged 22% after the discount footwear retailer forecast an adjusted pre-tax loss of approximately £1 million for the financial year ended 3 October, compared with a £2.4 million profit a year earlier.
Revenue declined 4.5% to £142.4 million, reflecting weaker consumer confidence and a reduction in the company’s store estate from 269 to 251 locations.
The results underline the pressure facing parts of the UK retail sector as households continue to manage elevated living costs.
Investor attention remains firmly focused on Wednesday’s Autumn Budget, when Chancellor John Healey is expected to announce more than £20 billion in investment measures alongside modest tax increases.
The Government is seeking to support economic growth while reassuring financial markets about borrowing levels and the sustainability of public finances.
Higher borrowing costs have intensified the challenge, with 10-year UK gilt yields having exceeded 5.5% earlier this month, while annual consumer price inflation accelerated to 3.5% in September from 3.1% in August.
Markets are also anticipating a possible quarter-point Bank of England interest rate increase to 4% next week, adding to concerns about borrowing costs for households and businesses.
In currency markets, sterling weakened to $1.3321 against the dollar, compared with $1.3353 on Monday, while strengthening slightly against the euro to €1.1951.
Brent crude eased to $114.84 a barrel, down from $117.02 at Monday’s close, as diplomatic efforts continued to reduce tensions in the Middle East.
Officials from Saudi Arabia, Turkey and Pakistan held discussions with Iranian representatives in Tehran aimed at preventing renewed military escalation.
However, continuing regional security concerns, including reports of further Houthi attacks, kept uncertainty elevated across energy markets.
Gold traded at $4,012.47 an ounce, slightly below Monday’s level, while US Treasury yields edged higher.
Across the Atlantic, Wall Street futures pointed towards modest gains, with the Dow Jones, S&P 500 and Nasdaq Composite each expected to open around 0.2% higher.
Coca-Cola reported a 10% rise in quarterly net income to $4.06 billion, alongside a 7.4% increase in revenue to $13.38 billion, exceeding market expectations.
Despite raising its annual guidance, Coca-Cola shares slipped 0.7% in pre-market trading amid concerns that growth in North America had fallen short of forecasts.
The FTSE 100’s midday decline reflects disappointing reactions to major corporate earnings rather than a broad retreat across UK equities, with the FTSE 250 and AIM All-Share both remaining positive.
Attention will now turn to Wednesday’s UK Budget, upcoming Bank of England policy decisions and the US Federal Reserve’s two-day interest rate meeting, alongside further economic data that could shape expectations for inflation, growth and financial markets.
