London stocks moved higher on Tuesday as stronger-than-expected results from major consumer, healthcare and industrial companies lifted sentiment, helping the FTSE 100 extend its recent gains despite pressure on banking shares.
The FTSE 100 closed 0.8% higher, while the FTSE 250 gained 0.5%, with investors focusing on a series of positive updates from Unilever, Croda and GSK.
Unilever was one of the standout performers, rising 8.0% after increasing its full-year guidance following a stronger-than-forecast second quarter. The company reported underlying sales growth of 5.8% for the three months to the end of June, comfortably ahead of market expectations of 4.3% and marking its strongest growth rate in more than a decade.
The results prompted positive reactions from analysts, with Barclays describing the quarter as a “blow out” performance, while RBC Capital Markets called it a very strong set of figures.
Croda also gained 8.0% after confirming its full-year sales outlook as second-quarter revenue growth accelerated, while Admiral climbed 4.9% following a Citigroup upgrade to ‘buy’.
GSK added 3.5% after its second-quarter results exceeded forecasts, reporting core operating profit of £2.80 billion, up from £2.63 billion a year earlier. Core earnings per share increased to 50.5p from 46.5p, while pre-tax profit reached £2.68 billion, beating company expectations.
Banks moved in the opposite direction, with Barclays falling 4.8% despite reporting solid results. Investors had raised expectations after stronger-than-expected figures from major US banks last week, leaving less room for positive surprises from UK lenders.
Citigroup said Barclays’ divisional performance and planned investment spending were likely to disappoint some investors, highlighting higher costs and a combined profit shortfall across its UK businesses. However, Jefferies said the results did not materially change the bank’s longer-term outlook.
Other lenders also declined ahead of their own results, with Lloyds Banking Group falling 1.4% before reporting on Thursday and NatWest dropping 2.4% ahead of Friday’s update.
On the FTSE 250, Coats Group jumped 9.0% after investors welcomed its latest results, while SSP Group climbed 6.2% following a positive trading update. Technology stocks remained under pressure, however, with Ceres Power falling 14% and Raspberry Pi declining 5.8%.
European markets also finished higher, with Paris’ CAC 40 rising 0.6% and Frankfurt’s DAX 40 adding 0.4%.
Global technology concerns continued to influence sentiment after South Korea’s Kospi index fell 11%, driven by sharp declines in semiconductor giants Samsung Electronics and SK Hynix.
Investors remained concerned about artificial intelligence infrastructure spending and increasing competition from China, with ASML also falling 4.6% following reports of new Chinese semiconductor equipment production.
In the US, markets stabilised after recent chip stock losses, with the Dow Jones Industrial Average rising 1.3% and the S&P 500 gaining around 0.3%, while the Nasdaq Composite remained close to flat.
Semiconductor shares including Micron Technology, SK Hynix and Sandisk stayed under pressure, although Nvidia recovered from earlier losses to move back into positive territory.