Shell shares rose at the London open on Thursday, after announcing a share buyback, boosting the FTSE 100 index into positive territory, despite a decline for mining shares and investor trepidation ahead of a European Central Bank policy announcement.
The Frankfurt-based central bank reveals its interest rate decision at 1315 BST, which will be followed by a press conference from the bank's president, Christine Lagarde. After the ECB, the Federal Reserve will make a rate decision next week Wednesday and the Bank of England a day after its US counterpart.
Setting the tone, and having given European stocks a boost on Wednesday afternoon, the Bank of Canada raised rates by a smaller-than-expected 50 basis points. The smaller hike gave hope that central banks are ready to ease off on monetary policy tightening.
The FTSE 100 index was up 15.47 points, or 0.2%, at 7,071.54. However, the mid-cap FTSE 250 was down 45.72 points, or 0.3%, at 7,071.54, and the AIM All-Share was down 2.47 points at 807.20.
The Cboe UK 100 was up 0.3% at 706.52, the Cboe UK 250 flat at 15,498.56, and the Cboe Small Companies was up 0.1% at 12,399.36
In European equities on Thursday, the CAC 40 in Paris was down 0.5%, while the DAX 40 in Frankfurt was 0.4% lower.
As the ECB takes centre stage, the bank's policy-makers continue to deal with sky-high inflation and surging energy costs, which will likely see the central bank carry out its third successive interest-rate hike - this one likely to be 75 basis points or more.
Analysts are all but convinced the bank will up rates by another 75 basis points, but some say there is room for a full percentage point raise - 100 basis points.
The euro traded at $1.0061 early Thursday, steady on $1.0064 late Wednesday.
The pound was, just barely, holding above $1.16 on Thursday morning. Sterling was quoted at $1.1601, down from $1.1612 at the London equities close on Wednesday.
In London, oil producer Shell added 3.4%.
Shell announced net profit totalling $6.7 billion in the third quarter, after oil prices surged, improving from a loss after tax of $447 million in the same period last year.
Chief Executive Ben van Beurden said: 'We are delivering robust results at a time of ongoing volatility in global energy markets. We continue to strengthen Shell's portfolio through disciplined investment and transform the company for a low-carbon future. At the same time we are working closely with governments and customers to address their short and long-term energy needs.'
Flush with cash, Shell said it will buy back $4 billion of its shares.
The latest profit was however far less compared with its second-quarter net income totalling $18 billion. Shell alerted the market on the comparison earlier this month, blaming the drop on a slump in refining margins.
Although oil and gas prices have surged from a year ago following the invasion of Ukraine by major energy producer Russia, hydrocarbon values are cooling as the northern hemisphere experiences mild temperatures and countries shore up supplies.
Shell last month announced that van Beurden will step down as CEO at the end of the year, as the energy major looks to reinvent itself under renewables boss Wael Sawan.
Peer BP advanced 2.3%.
Brent oil was trading at $93.39 a barrel, soft from $93.93 late Wednesday.
Lloyds Banking gave back 1.9%.
The lender said its third quarter was 'robust', thanking its income growth, balance sheet 'momentum' and 'resilient' customer focus.
In three months to September 30, pretax profit slumped 26% to £1.51 billion from £2.03 billion.
The bank set aside £668 million in the quarter as underlying credit impairments to handle the fallout from increased bad loans, reversing from the £119 million gain recorded the year prior.
Net income was up 13% to £4.59 billion from £4.08 billion, as underlying net interest income rose 19% to £3.39 billion from £2.85 billion, but other income was down 4% to £1.28 billion from £1.34 billion.
Aiding its income growth, Lloyds's banking net interest margin improved to 2.98% from 2.55%. Looking at 2022 as a whole, the bank said its NIM will top 2.90%.
Shore Capital said the Lloyds pretax profit of £1.51 billion missed market consensus of £1.84 billion.
'Guidance sees full year NIM upgraded which is broadly offset by a downgrade to the impairment ratio, although capital generation is now expected to be better than previously expected,' said analyst Gary Greenwood.
'While the strengthening of provisions is prudent given the deterioration in the economic outlook, and observed asset quality remains strong, we think the market may be spooked by the miss to expectations and downgraded guidance in this respect.'
Anglo American shed 2.3%. The miner's copper and platinum metals production fell by 6% in the third quarter, with iron production down 5% as Anglo lamented a 'challenging operating environment'.
Copper production was down to 147,000 tonnes, while platinum slipped to 1.05 million ounces. iron was down to 16.1 million tonnes.
By contrast, output of steelmaking coal increased by 28% to 5.5 million tonnes.
'As we move through the final quarter, we are focused on maintaining this operational momentum to deliver our full year guidance,' Anglo said. 'The continued safe ramp-up of our steelmaking coal operations, as well as further performance improvements at our iron ore businesses, are priorities to set the platform for delivery into next year.'
Mining peers Rio Tinto 1.7% and Antofagasta 1.1% lost.
It was a mixed close for stocks in the US on Wednesday, with the tech-heavy Nasdaq taking a hit from disappointing tech earnings. The Dow Jones Industrial Average closed up slightly, and the S&P 500 index closed down 0.7%, but the Nasdaq Composite lost 2.0%.
Facebook-owner Meta Platforms lost 20% in after-hours trade in New York after the release of its earnings. The stock already had lost 5.6% in the regular session on Wednesday, amid share tumbles for peers Alphabet and Microsoft, closing down 9.1% and 7.7%, respectively. The pair also had disappointed with the quarterly results, released late Tuesday.
Meta, reported, for the three months that ended September 30, its revenue fell 4% to $27.71 billion from $29.01 billion a year before. Income from operations dropped 46% to $5.66 billion versus $10.42 billion. Net income was $4.40 billion, down 52% versus $9.19 billion.
Investors will now be keenly anticipating figures from Amazon and Apple after the closing bell in New York on Thursday.
In Asia on Thursday, stock markets were mixed.
The Shanghai Composite closed down 0.6% but the Hang Seng index in Hong Kong advanced 0.8%. The Japanese Nikkei 225 index ended down 0.3%. The S&P/ASX 200 stock index in Sydney closed up 0.5%.
Against the yen, the dollar was quoted at JP¥145.71, down from JP¥146.50.
Gold was quoted at $1,661.60 an ounce early Thursday, lower from $1,665.70 on Wednesday evening in London.
Aside for the ECB, the economic calendar also has a US gross domestic product reading at 1330 BST.
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