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31 Oct 2019 | 09:00

FTSE 100 drifts lower after tough Q3 for Lloyds, Shell

The FTSE 100 was down by 0.2% in early trading this morning amid mixed news from third-quarter trading.

The FTSE 250 was slightly higher, up by 0.1%.

Royal Dutch Shell fell by more than 3% after it reported CCS earnings of of $4.8bn for the third quarter of 2019, lower than the same period last year.

The oil and gas giant said the result reflected lower realised oil, liquefied natural gas (LNG) and gas prices, as well as weaker realised refining and chemicals margins.

This was partly offset by significantly stronger contributions from LNG and oil products trading and optimisation as well as higher realised margins in retail and global commercial.

Housebuilder Crest Nicholson saw its shares slide by 7.4% after warning on profit for the full year as Brexit uncertainty weighed on sales.

The company set out a plan to turnaround performance, including cutting cost and trimming land sales.

Lloyds Banking Group shares fell by 1.8% after the bank reported a sharp fall in profit as further payments for protection insurance claims in the third quarter dented growth.

In the three months ended 30 September, pre-tax profit fell 97% to £50m from £1.8bn a year earlier and included an additional £1.8bn PPI charge in the quarter, the company said.

Lloyds also announced that its chief operating officer, Juan Colombás, planned to retire in July 2020.

British Airways owner International Consolidated Airlines reported a slump in profit, as pilot strikes disrupted operations, keeping a lid on revenue growth. Its shares were down slightly, by 0.6%.

For the nine months ended 30 September, operating profit, after exceptional items, fell 24.9% to €2.5bn, while revenue increased 5.7% to €19.4bn.

Pilots from the BALPA union walked out for two days in September in a dispute over pay and benefits.

BT shares were up by 0.6% after it reported flat first-half profit as costs increased amid a ramp-up in investments and revenues were hurt by weaknesses in its global and enterprise businesses.

Adjusted earnings (EBITDA) fell 3% to £3,923m and capital expenditure was up £225m to £1,882m in the period, driven by increased network investment.

Smith & Nephew reported underlying revenue growth of 4% for the third quarter of 2019, driving its shares up by 0.9%.

The medical equipment manufacturer also reported continued mid-teens growth from emerging markets operations, led by a quarter of strong growth in China.

Finally, mining giant Rio Tinto reported a free cash flow of $10bn for 2019 based on current spot prices ahead of an investor seminar in London today. Its share price dropped by 0.5%.

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