Rishi Sunak’s move into 10 Downing Street has further calmed the market for UK gilts (government bonds). The current yield on 10-year gilts is around 3.61% – lower than before Kwasi Kwarteng announced his disastrous mini-budget on 23 September. Lower gilt yields will bring down interest rates on new mortgages and should help make the stock market more attractive. The pound has also had a strong day, rising 1.78% to $1.15.

That rise in the pound, however, makes some global stocks listed in London a little less attractive. That’s because when you convert profits earned in dollars back into sterling, a higher exchange rate means that the final profits figure in pounds is a little lower. So for the FTSE 100, which contains lots of global businesses, it was a mixed day even though interest rates are falling. The FTSE 100 ended flat at 7,031 points. The FTSE 250, which is more weighted to UK-focused businesses, rose 2.8% to 17,832 points.

In today’s movers we look at why HSBC shares have fallen even though the bank has made better than expected profits. And we also look at Superdry which tried to bury some bad news yesterday.

The good news at THG has helped to boost the share price of another online retailer – ASOS (ASC). The ASOS share price closed up 15% today at £5.97. Yesterday’s news that Mike Ashley’s Frasers Group (FRAS) has built a 5.1% stake is no doubt also a factor. Today’s rise may mean that Ashley is buying more ASOS shares today. Or other investors are buying shares hoping that Ashley will launch a takeover bid. Or another player may be building a stake. Or all of the above.

Even after today’s rise, ASOS is trading on a multiple of 15 times forecast earnings for this year. So you can argue that it’s not expensive. However, the risk is that Ashley will walk away, which would almost certainly hit the price in the short term.

Shares in THG (THG) surged 17% today to 54.3p after the online retailer announced that third-quarter revenues were up 2.1% to £519 million. The company still expects revenue growth of between 10% and 15% this year. What’s more, THG has agreed a new £156 million banking facility with some existing lenders. That provides some reassurance about THG’s cash position.

THG has had a rough ride since it listed back in 2020. It listed at 500p a share, and the shares almost doubled from there, taking the overall market value to almost £10 billion. However, concerns about corporate governance and the high valuation triggered a huge share price fall to a low of 31p. Even after today’s rise in the price, the market cap is only £100 million.

WAG Payments (WPS) had a good day with the shares rising 2.2% to 83.2p. The company provides integrated payments systems for the road transport industry, and it’s been performing well over the last nine months. Net revenues rose 23% to £118 million in line with management expectations. WAG also announced it was buying Inelo, a fleet management solutions business in Poland and Slovenia, for up to £313 million.

Segro (SGRO) was the biggest riser in the FTSE 100 today. The shares are up 7.1% at 798p. Segro is a £9 billion commercial property firm, and today’s news of lower gilt yields has encouraged investors to buy shares. Investors usually buy commercial property shares for the income – Segro currently has a yield of about 4%. If Gilts are paying 4%, there’s not a lot of point in buying shares in Segro at that yield. But if Gilts pay less, then Segro is more attractive. Analysts at UBS are positive on Segro; they have raised their rating on the stock to "buy".

Segro’s share price was hit earlier this year after Amazon issued a profits warning. (Segro owns a fair number of "big box" warehouses used by the likes of Amazon.)

Shares in another big commercial property player, Land Securities (LAND), were also on the up today, closing 6% higher at £5.69.

HSBC (HSBA) reported better-than-expected profits this morning, but the share price dropped 7% nonetheless to 442.6p. Adjusted pre-tax profits for the third quarter came in at £5.8 billion, up from £4.8 billion a year earlier. City analysts had predicted £5.3 billion in profit.

So why has the share price fallen?

It’s partly because finance director Ewen Stevenson is leaving. Stevenson is well respected in the City and has a reputation for keeping control of costs. Another issue is the slowing property market in China – important for HSBC as about half of its revenue comes from Asia. The slower Chinese market, combined with a "mild recession" in the UK, has caused the bank to set aside £950 million this quarter for loan defaults. Once you include that provision and some other bits of bad news, the "official" or reported pre-tax profit figure doesn’t look so good – down 42% to £2.7 billion.

Optimists may be attracted by the dividend yield, which is almost 5% – much better than a savings account. But if the Chinese economy continues to deteriorate, that dividend isn’t 100% safe.

It’s leaked out today that Deloitte has resigned from its role as auditor at Superdry (SDRY). Deloitte is unhappy about poor internal financial controls at the company. Worryingly, Superdry attempted to bury news of the resignation in an announcement yesterday about the date of its annual general meeting. We’re indebted to the Stockopedia website for spotting this.

A resignation of an auditor is serious and doesn’t reflect well on the company at all. Granted, founder and CEO Julian Dunkerton, made a significant share purchase earlier this month, but the overall outlook now is negative. The share price is down 2.7% today at £1.16p. Further share price falls look likely. 

It’s been another bad day for shareholders in carpet business Victoria (VCP). The shares closed 5.4% down at £5.26p. They’re down 55% this year. The big problem with Victoria is that it’s carrying a lot of debt. Net debt was £758 million in April, a chunky sum for a company with a market cap of £620 million. Net gearing, which compared debt levels with the book value of equity, is very high at 374%. Carpets isn’t a great business to be in at the beginning of a recession, and if you’re encumbered with heavy debts, you’re poorly positioned to cope.

Estate agent Foxtons (FOXT) was down almost 2% today at 27.8p following a 32% share price slide this year. Even though mortgage rates may not rise as much as we feared two weeks ago, the outlook for residential property isn’t great and Foxtons has a tough year or two ahead.

Now take a look at our weekly share tips