The FTSE 100 and European stocks opened mixed this Tuesday following the rescue of First Republic Bank (FRC) in the US by JPMorgan (JPM).
The FTSE 100 (^FTSE) rose 0.18% to 7,885 points at the open, while the CAC 40 (^FCHI) in Paris slipped 0.17% to 7,478 points. In Germany, the DAX (^GDAXI) was muted at 15,916.
FTSE 100
The UK’s blue chip index was higher, boosted by a jump in shares of HSBC (HSBA.L) after the lender’s quarterly profit tripled, though overall gains were limited by weakness in energy stocks.
BP (BP.L) tumbled 4.8% after the oil major pared back its share buyback programme.
Housebuilders received a boost from data from Nationwide which showed a monthly increase in house prices for the first time in seven months.
Read more: BP profits hit £4bn in three months as UK households struggle with energy bills
Housebuilders rose as Persimmon (PSN.L) surged 5.57%, Barratt Developments (BDEV.L) climbed 2.54% and Taylor Wimpey (TW.L) rose 2.07%.
US and Asia
Across the pond, S&P 500 futures (ES=F), Dow futures (YM=F) and Nasdaq futures (NQ=F) were all near the flatline as trading began in Europe.
US stocks were muted on Monday as Wall Street digested JPMorgan Chase’s takeover of regional lender First Republic Bank.
The Dow Jones (^DJI) lost 0.14% to close at 34,051 points. The S&P 500 (^GSPC) finished near the flatline, slipping just 0.04% to 4,167 points and the tech-heavy NASDAQ (^IXIC) lost 0.11% to 12,212.
Regulators seized First Republic early on Monday and sold most of the bank’s operations to JPMorgan in the largest bank failure since the 2008 financial crisis.
JPMorgan Chase CEO Jamie Dimon said that the seizure of First Republic puts to rest a period of panic over the banking system.
“This part of the crisis is over,” he told analysts on a Monday conference call.
A number of banks, including JPMorgan and PNC, had submitted bids on Sunday to the Federal Deposit Insurance Corporation to acquire the embattled bank.
Read more: UK house prices rebound in April after seven month decline
The deal came at a crucial week for Wall Street ahead of the Federal Reserve’s key rate decision meeting.
In Asia, markets were higher on Tuesday as most bourses returned after the long Labour Day weekend.
Tokyo’s Nikkei 225 (^N225) gained 0.12% to 29,157 points, while the Hang Seng (^HSI) in Hong Kong rose 0.37% to 19,986. The Shanghai Composite (000001.SS) was closed for a holiday Tuesday.
Pound
The pound’s (GBPUSD=X) rally against the dollar stalled on Tuesday, with sterling trading at $1.2485.
Sterling (GBPEUR=X) also lost ground against the euro to trade at €1.1368.
Oil
Meanwhile, Brent crude (BZ=F) was steady, trading at around $79 per barrel amid fears of a slowdown in China’s recovery.
Watch: JPMorgan Chase taking over First Republic Bank in 2nd largest bank failure in US history
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