Asian markets were lower on Tuesday with tech stocks hit by Apple's warning that it would miss its sales guidance this quarter due to lower production and sales in China owing to the impact of the coronavirus.

Although the UK market doesn't have a big weighting in tech stocks, the FTSE 100 index reflected the weak mood in Asia losing 0.9% to 7,363 led by financial and commodity stocks.

Europe's largest bank HSBC (HSBA) announced that it would cut 15% of its staff or 35,000 jobs after profits for 2019 fell 53% to $6bn.

Profits in its Asian business were up 6% to $18.6bn but the European and US operations underperformed and the bank took combined writedowns of more than $10bn for bad loans and its wholesale business.

Investors were also disappointed that there was no news on the appointment of a new chief executive officer to replace interim chief Noel Quinn. Shares were the biggest faller on the FTSE, losing 4% to 567p.

Mining group Glencore (GLEN) released a downbeat set of full year results with operating profits falling 26% to $11.6bn due to generally weaker commodity prices and specific challenges with some of its operations.

It also announced it would write down the value of its coal and oil assets by $2.8bn, pushing it to a full-year loss of $400m. Shares slid 0.7% to 235p.

Shares in Intercontinental Hotels Group (IHG) dropped 1.9% to £47.39 despite the firm reporting an 8% increase in 2019 full year revenues to $2.08bn and a 4% increase in operating profits to $865m, beating analysts' forecasts.

Keith Barr, chief executive, put the better performance down to faster growth in the number of new rooms opened and strong momentum into the end of last year.

While the coronavirus is still a challenge for the travel industry, Barr expects the hotels group to see a sharp recovery in demand later this year.

On a positive note, food producer Kerry Group (KYGA) delivered a solid update for the year to 31 December with revenues up 9.6% to €7.2bn and trading profits up 12.1% to €903m. Shares gained 2.6% to €120.

 

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Issue Date: 18 Feb 2020