Europe open: Banks weigh on markets as HSBC tumbles

27th Oct 2026 07:55

(Sharecast News) - European stock markets inched lower on Tuesday, though weakness in London weighed on the benchmark Stoxx 600 index on the back of heavy losses from HSBC and Reckitt Benckiser.

The pan-European index was 0.1% lower at 640.01 in early deals, with a 0.2% rise in Zurich and losses of 0.1-0.2% across Frankfurt, Paris, Milan and Madrid met with a 0.8% slump in London.

Market sentiment was cautious ahead of interest rate decisions from the US Federal Reserve and European Central Bank on Wednesday and Thursday, respectively.

Investors were also assessing the impact of elevated energy prices - Brent crude futures were up 0.4% at $111.19 a barrel - along with geopolitical tensions in the Middle East and a busy corporate earnings calendar.

Economic data provided some encouragement, with Germany's Ifo business climate index rising to 90.2 in October from 89.9 in September, suggesting a gradual improvement in Europe's largest economy.

Banking stocks were among the main drags on European indices, led by HSBC which tumbled 7% following its third-quarter results. Pre-tax profit rose to $9.63bn, with revenue 5% higher at $18.62bn, mainly reflecting growth in banking net interest income, but both figures were just slightly below forecasts.

European banking peers were also weaker early on, including Credit Agricole, BNP Paribas, Santander and Deutsche Bank, though losses were milder.

Also weaker in London was Reckitt Benckiser as the consumer goods giant cut its full-year sales growth guidance after third-quarter trading fell short of expectations, hit by manufacturing constraints in North America and weaker demand for vitamins and supplements in China.

Losses, however, were tempered by gains among technology and semiconductor stocks, led by Dutch chip equipment maker BE Semiconductor Industries.

Meanwhile, Swiss packaging group SIG surged after reporting stronger third-quarter trading and raising its full-year margin guidance.