MW: Banks and oil firms lift FTSE 100; HSBC weighs
By Sara Sjolin, MarketWatch
LONDON (MarketWatch) — Most U.K. stocks traded in positive territory on Tuesday, helping lift the benchmark stock index, although shares of Vodafone Group PLC and HSBC Holdings PLC added pressure after broker downgrades.
The FTSE 100 index UK:UKX +0.64% gained 0.2% to 6,328.55.
Shares of Standard Chartered PLC UK:STAN +2.31% rose 2.7% after Morgan Stanley lifted the bank to overweight from equal weight, citing an improving outlook for its Asia business and recent underperformance in the shares.
HSBC UK:HSBA +0.17% , HBC +0.07% HK:5 -0.86% was cut to equal weight from overweight by Morgan Stanley, sending the shares 0.5% lower.
“HSBC has now performed well (+27% over [the] past year) on strong Asian earnings and an improved balance sheet. It now appears fully valued, in our view, given an uninspiring revenue outlook, and we move to” equal weight, the Morgan Stanley analysts said in a note.
Shares of Vodafone UK:VOD -2.64% VOD -2.64% also declined after a broker downgrade, off 3.1%. Bernstein cut the wireless-telecom firm to underperform from market perform.
“Vodafone must belatedly pick its poison,” the Bernstein analysts said. “[Vodafone] can choose structural decline mitigated by cost-cutting and increased spend, or it can try to buy its way out of the problem,” they said.
Also among movers in London, shares of Tesco PLC UK:TSCO -0.15% TESO +2.50% inched 0.3% higher as J.P. Morgan Cazenove initiated coverage of the supermarket retailer with an overweight rating.
The bank further started coverage of J Sainsbury PLC UK:SBRY -0.75% and Wm. Morrison Supermarkets PLC UK:MRW -1.14% with underweight ratings, sending the shares 0.8% and 0.2% lower respectively.
Oil firms were also higher, even as oil prices nudged lower. Royal Dutch Shell PLC UK:RDSB +1.50% RDS.B +1.64% gained 0.5% and BG Group PLC UK:BG +0.35% rose 0.4%.
Outside the main index in London, shares of InternetQ PLC UK:INTQ +1.77% picked up 2.6%. The music-streaming-platform operator agreed to a strategic partnership with Samsung Electronics Co. KR:005930 +0.13%
Sara Sjolin is a MarketWatch reporter based in London. Follow her on Twitter @sarasjolin.
