The FTSE 100 recorded another record high on Tuesday boosted by HSBC, while Wall Street made further gains ahead of key tech earnings and central bank meetings.
The index closed up 42.92 points, or 0.4%, at 9,696.74, a new closing peak. It had earlier set a new intra-day high of 9,727.09.
The FTSE 250 ended 27.36 points lower, or 0.1%, at 22,484.12, and the AIM All-Share declined 1.61 points, or 0.2%, at 770.79.
HSBC rose 4.6% after raising guidance following better-than-expected third quarter results.
The Asia-focused, London-based bank said pre-tax profit fell 14% to 7.30 billion dollars (£5.50 billion) in the three months ending on September 30, down from 8.48 billion dollars (£6.38 billion) a year earlier.
Profit included a 1.1 billion dollar provision relating to the Bernard Madoff investment fraud.
Shore Capital analyst Gary Greenwood said excluding the Madoff-related charge, the performance in the third quarter was “better than expected”.
Analysts at Barclays said underlying pre-tax profit was 9% ahead of expectations driven by revenues, alongside stable asset quality.
Full-year guidance has been upgraded, and “confirms our view of a significantly stronger outlook for banking net interest income beyond 2025 than consensus”, the broker added.
In Europe on Tuesday, the Cac 40 in Paris ended down 0.3%, while the Dax 40 in Frankfurt closed down 0.1%.
Stocks in New York were higher at the time of the London close. The Dow Jones Industrial Average was up 0.6%, the S&P 500 was 0.2% higher, and the Nasdaq Composite advanced 0.5%.
Figures showed US consumer confidence was almost unchanged in October, with Americans flagging the government shutdown as a key concern.
The Conference Board’s consumer confidence index slipped 1.0 in October to 94.6, from an upwardly revised 95.6 in September. This was still slightly better than the 93.4 median forecast cited by Goldman Sachs.
The longer the shutdown persists, “the more likely it is that confidence will continue to decline, as federal workers and private government contractors go without pay”, said Grace Zwemmer at Oxford Economics.
The yield on the US 10-year Treasury was quoted at 3.98%, trimmed from 4.02% on Monday. The yield on the US 30-year Treasury stood at 4.55%, narrowed from 4.59%.
The pound was quoted lower at 1.3279 dollars at the time of the London equity market close on Tuesday, compared with 1.3331 dollars on Monday.
The euro stood at 1.1660 dollars, up from 1.1639. Against the yen, the dollar was trading at 152.14, down from 153.04.
While sterling fell, the yield on the UK 10-year bond held steady at 4.40% as reports suggested the Government is facing a bigger-than-expected hole in the public finances as it prepares for next month’s Budget.
The BBC and the Financial Times reported that a downgrade to the UK’s productivity performance from the Government’s official forecaster could lead to Chancellor Rachel Reeves facing a £20 billion gap in meeting her tax and spending rules.
The Treasury declined to comment on “speculation” ahead of the Office for Budget Responsibility’s final forecast, which will be published on November 26 alongside the Budget.
The OBR will deliver its final draft forecast, including productivity to the Treasury on Friday.
Leading the FTSE 100 was Airtel Africa, which climbed 16% after raising capital expenditure forecasts to build on improved sales, earnings and customer numbers reported in the first half of the financial year.
London-based Airtel, which operates telecommunications and mobile money services in Africa, said pre-tax profit ballooned to 656 million dollars (£493 million) in the half year to September 30 from 178 million dollars (£134 million) the year before.
The company said Airtel Money remains on course for a listing in the first half of 2026.
Deutsche Bank thinks this listing will compel investors to value Airtel Africa on a sum-of-the-parts basis and drive its share price “substantially higher”.
“We estimate group value could reach at least 380p per share,” Deutsche said.
Spirax Sarco rose 1.2% as UBS upgraded to “buy” from “neutral”, highlighting a key growth driver in its Electric Thermal Solutions business.
UBS said ETS offers the “most overlooked potential in growth, margins and returns”, while expectations for the firm’s Steam Thermal Solutions unit in China and Watson-Marlow also seem “too low”.
“We expect all divisions to contribute positively and, with valuation not reflecting the sustainable growth ahead, we upgrade to buy,” the broker said.
On AIM, Idox jumped 25% as it agreed to be bought by a newly formed company indirectly owned by investment funds of Long Path Partners, a privately owned investment firm.
Under the deal, Idox shareholders will receive 71.5p per share, 27% higher than Monday’s closing price of 56.40p. It valued Idox’s share capital at £339.5 million.
Gold traded at 3,957.04 dollars an ounce on Tuesday, down from 3,993.32 on Monday.
After the latest drop, Joshua Mahony, analyst at Scope Markets, said for traders and investors alike, the question is when this “correction phase” will come to a halt, with gold having dropped 10% in the past week alone.
“The concern for many holders is the sheer volatility we are seeing for an asset that is supposed to be stable in nature, with this month seeing the biggest price volatility on record,” he added.
Brent oil traded at 64.33 dollars a barrel on Tuesday, down from 65.99 late on Monday.
The biggest risers on the FTSE 100 were Airtel Africa, up 37.8p at 268.4p, HSBC Holdings, up 46.2p at 1,050.2p, Vodafone, up 3.9p at 93.0p, Rolls Royce, up 26.0p at 1,146.0p and Barclays, up 8.7p at 404.4p.
The biggest fallers were Barratt Redrow, down 9.9p at 393.8p, Burberry, down 25.5p at 1,300.0p, Rentokil Initial, down 8.2p at 431.6p, London Stock Exchange Group, down 180.0p at 9,662.0p and Berkeley Group, down 62.0p at 4,090.0p.