By Sara Sjolin, MarketWatch
LONDON (MarketWatch) — Shares of HSBC Holdings PLC dropped 2.4% in London on Monday, weighing on Britain’s benchmark FTSE 100 stock index, after the global banking major reported a 52% drop in third-quarter net income attributable to shareholders.
HSBC UK:HSBA -1.65% HBC -0.89% HK:5 -0.26% said earnings per share dropped to $0.13 against $0.28 in the year-earlier quarter, while adjusted profit before tax more than doubled in the quarter to $5 billion.
For the quarter, the bank further said it set aside an additional $800 million provision related to a U.S. money-laundering investigation.
“We are actively engaged in discussions with U.S. authorities to try to reach a resolution, but there is not yet an agreement,” HSBC said.
The FTSE 100 index UK:UKX -0.63% slid 0.7% to 5,830.44, giving up parts of a 1.1% gain from last week.
U.S. election in focus
Market sentiment will be dominated this week by the U.S. election and what it may mean for the so-called fiscal cliff.
Other banking shares were also on the decline, tracking a negative mood across European bourses where uncertainty about whether Greece’s parliament will pass a round of austerity cuts required to receive its next tranche of bailout money spooked investors. Nervousness over the outcome of the U.S. presidential election later this week also added pressure on markets.
Shares of Barclays PLC UK:BARC -1.15% BCS -0.91% dropped 1.5%, Standard Chartered PLC UK:STAN -1.17% lost 1.3% and Royal Bank of Scotland Group PLC UK:RBS -1.19% RBS -3.77% gave up 1.2%.
Reuters Enlarge Image
HSBC’s building in London. The bank’s profit declined sharply in the third quarter.
Oil firms’ shares also dropped, as oil prices moved lower. BP PLC UK:BP -1.49% BP -1.12% lost 1.4%, while shares of Royal Dutch Shell PLC UK:RDSB -0.57% RDS.B -0.76% lost 0.3%.
Among mining firms, Rio Tinto PLC shares UK:RIO -1.99% RIO -0.37% AU:RIO +4.68% fell 1.6%, BHP Billiton PLC UK:BLT -1.66% BHP -1.13% AU:BHP +2.96% declined 1.4% and Vedanta Resources PLC UK:VED -2.33% gave up 2.1%.
Shares of manufacturing and engineering firm Weir Group UK:WEIR +3.88% bucked the negative trend in London and jumped 3.7%, after the company said it sees double-digit profit growth in 2012. For the full year, it said it’s on track to deliver pretax profit of 440 million pounds ($705 million) to £450 million pounds, which is within the range of previously announced expectations. See: Weir Group sees double-digit profit growth in 2012.
In Dublin, shares of low-cost airline Ryanair Holdings PLC IE:RY4B +7.47% surged 7.5%, after the firm said profit for the first half of the year rose 10%.
Sara Sjolin is a MarketWatch reporter, based in London.