Tuesday 27 September 2016

HSBC decides to keep base in UK, FTSE 100 soars

Published 15/02/2016 | 13:29

HSBC is considering relocating to Hong Kong. Photo: Reuters
HSBC is considering relocating to Hong Kong. Photo: Reuters

The London market soared, amid lender HSBC announcing it will keep its headquarters in the UK after a lengthy high-profile review.

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Europe's biggest bank said the decision, which came after an April review, was "the best outcome for our customers and shareholders", while the Treasury also welcomed the move.

The FTSE 100 Index jumped 128.7 points to 5836.4, building on strong overnight trading in Asia and a 3pc rise on the London market on Friday.

Germeny's DAX and the Cac 40 in France were both up by more than 3pc.

However, global markets remain volatile this year with investors troubled by the falling oil prices, sliding bank stocks last week and longer term prospects of a slowdown in world growth. Top-flight shares in London have fallen by some 7pc in this year.

The pound was a cent down against the US dollar, after UK foreign secretary Philip Hammond says there will be "very big issues" still on the table at an EU summit this week as leaders try to thrash out a deal to keep Britain in the 28-nation bloc.

Sterling was slightly up against the euro at 1.29.

In stocks, HSBC lifted 4.4p to 444.8p after chief executive Stuart Gulliver said: "Having our headquarters in the UK and our significant business in Asia Pacific delivers the best of both worlds to our stakeholders."

Banks rose across the board this morning as the man behind the UK's retail banking reforms, Sir John Vickers, said his recommendations have been watered down.

Sir John, head of the Independent Commission on Banking, criticised the Bank of England's plans to build an extra buffer of capital for not being strong enough.

Barclays lifted more than 2pc, or 3.7p, to 161p, Lloyds Banking Group was up 1.7p to 60.1p and Royal Bank of Scotland was 5.4p higher at 245.5p.

Nurofen owner Reckitt Benckiser was the biggest riser in the top flight after it said like-for-like sales rose by 6% in the year to the end of December, pushing pre-tax profits up by 4% to £2.2bn.

Chief executive Rakesh Kapoor said growth had been achieved despite a year of "mixed market conditions", adding that he expected general market conditions will remain "tough" in 2016.

Shares rose more than 6pc, or 396p to 6360p

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