HSBC shares fell on Tuesday as rising credit provisions soured first-quarter earnings, leading the bank to miss estimates.

HSBC delivered a steady first quarter, with reported profit before tax of $9.4bn, broadly flat year-on-year, as growth in Wealth fees and higher banking net interest income offset a heavier credit charge and rising costs.

But this was below expectations, and shares sank about 5% on Tuesday.

Banking NII rose $0.7bn to $11.3bn, helped by deposit growth and structural hedge reinvestment at higher yields.

Wealth was the other engine, with strong fee income out of International Wealth and Premier Banking and Hong Kong as customer activity picked up. Customer lending grew $20.1bn on a constant currency basis with growth across every segment.

The issues for investors were a $1.3bn charge, $0.4bn higher than Q1 2025, dragged up by a $0.4bn fraud-linked UK securitisation exposure and a $0.3bn top-up reflecting the deteriorating outlook following the late-February onset of conflict in the Middle East.

“HSBC’s exposure to faster growing developing economies brings extra growth potential but there are risks too, and the Iran conflict has prompted meaningful impairments alongside first-quarter results,” said AJ Bell head of markets Dan Coatsworth.

“These, plus provisions for fraud-related issues in the UK, cast a shadow over the quarterly numbers with earnings coming in below forecasts. 

“The sizeable fraud-related charge is a reminder that risks don’t only exist in more far-flung parts of the world. It may also raise some questions about the robustness of controls within the business.”

Long-term investors won’t be overly concerned as today’s decline looks nothing more than profit taking after a strong run in the stock.

HSBC shares are 52% higher over the past year.

Light Science Technologies shares surged on Tuesday after securing its first material supply order for its fire-resistant graphite barrier system Injectaclad, just two weeks after completing the acquisition of RLUK Injection.

The contract with one of LSTH’s approved installers is worth around £0.41m in Injectaclad material over a 19-week window, supporting a five-storey residential project in East Yorkshire, kicking off in early May. Revenue is expected to land in full in the current financial year.

Investors will also be encouraged by the fact that there are already commitments from 5 of the 11 quality-accredited installation contractors, pointing to a swift ramp-up for what is a higher-margin supply revenue stream than LSTH’s previous installer-only role.

With the Building Safety Regulator pushing to clear cladding remediation backlogs, the company said its Passive Fire Protection division looks well placed to capture a larger share of the value chain over the rest of 2026.

Simon Deacon, CEO of LSTH, said “We are delighted with the recent order win, which highlights the significant opportunity to position ourselves as both an installer and supplier of Injectaclad. The PFP division is gaining increased visibility and is well placed to secure a growing number of projects that would otherwise require full façade removal and replacement, delivering substantial cost savings and minimising disruption for residents.”

“With 11 installers in the network, the Injectaclad acquisition provides access to a broad and growing pipeline of potential projects. The Company is also seeing a growing number of BSR applications specifying Injectaclad. This represents a highly exciting opportunity for the Group, not only within the PFP division but across all our operations, as we focus on driving order conversion, increasing recurring revenues and delivering sustainable profitability.”

Light Science Technologies has announced a steady stream of new contract wins in recent months and is well-capitalised after a recent fundraise.

Palantir has delivered a blockbuster first quarter, with revenue up 85% year-on-year to $1.63bn, the company’s highest growth rate on record, prompting another upgrade to full-year guidance.

The US business is the key driver of growth, more than doubling year-on-year to $1.28bn, with US commercial jumping 133% to $595m. Business from the US government rose 84% to $687m.

Palantir closed 206 deals of $1m or more in the quarter, including 47 above $10m.

“Palantir delivered another strong quarter, with demand for its AI platform continuing to accelerate across both commercial customers and government agencies, said Matt Britzman, senior equity analyst, Hargreaves Lansdown.

Total contract value reached $2.41bn, up 61%, and US commercial remaining deal value sits at $4.92bn, more than double a year ago, pointing to a healthy revenue runway.

But it’s not just a revenue growth story. Palantir is successfully converting top-line growth into profits. GAAP operating margin came in at 46%, with adjusted operating margin of 60% and adjusted free cash flow margin of 57%.

The outlook should be encouraging for investors. Full-year revenue guidance has been lifted to $7.65bn–$7.66bn, implying around 71% growth and ten points ahead of the previous quarter’s outlook.

US commercial revenue guidance has been raised to at least $3.22bn, representing a significant share of the year’s forecast revenue. Q2 is guided to revenue of $1.80bn-ish, with adjusted operating income of around $1.06bn.

“The key point is that this growth is not just about companies testing AI in small pockets – Palantir is increasingly being used in real-world operations, where the stakes are high, and customers need AI to deliver clear, measurable results,” Matt Britzman said.

“Management struck a very confident tone, pointing to strong US demand, expanding customer commitments and a sharp uplift in full-year guidance. That all supports the idea that Palantir has become one of the clearest ways to play the shift from AI hype to implementation.”

The ‘hype’ Britzman alludes to is still evident in Palantir shares, which value the company at $350bn – an eye-watering valuation on earnings and sales multiples. For now, however, Palantir’s innovative offering and promise of future growth are proving sufficient to support the shares.

Some positive news from AOTI (LON: AOTI) with additional data on its TWO2 treatment showing effectiveness in treatment of hard to heal wounds and a low level of recurrence. Hospitalisations and amputations were low. AOTI is still awaiting the CMS coverage determination for the wider Medicaid population in the US. That will give greater access to the treatment. The share price rebounded 48.2% to 63p.

Stonehage Fleming Investment Management increased has taken a 6.1% stake in Dianomi (LON: DNM). The share price improved 28.6% to 18p.

A positive trading statement by IG Design (LON: IGR) has led to upgrades for the year just ended and the current year. Ongoing gift wrap and stationery business is better than expected, although consumer confidence remains weak. In the year to March 2026, revenues were $292m, while the pre-tax profit estimate has been increased from $9.5m to $11.5m. This year’s pre-tax profit forecast has been raised from $12.3m to $14.3m, helped by an earnings enhancing acquisition in South Africa. Net cash is $72m before the £3.4m spent on the acquisition. The share price recovered 27.8% to 69.5p.

Professional services provider Christie Group (LON: CTG) beat previously upgraded profit forecasts for 2025. Pre-tax profit jumped from £2.6m to £6m, helped by the sale of loss making operations, and the dividend was raised 56% to 3.5p/share. Additional hires will increase costs this year, so profit is forecast to fall to £4.6m. The share price rose by one-quarter to 150p, which is 11 times prospective 2026 earnings.

FALLERS

Sexual dysfunction treatments developer Futura Medical (LON: FUM) is putting its new strategy into force by cutting costs and focusing on a more commercial approach. Female sexual dysfunction treatment WSD4000 has significant potential, and a phase 3 trial could start before the end of the year. Potential partners are in talks with the company. There was £3.4m in the bank at the end of 2025 and this should last until June. The previously highlighted milestone payment from Haleon for achieving the Eroxon patent in the US has still to be paid, but management is confident that it has been triggered. This cash should come in before June and would last until the end of the year. Alternative funding options are being assessed just in case the Haleon payment is not made before June. The share price dived 48.6% to 0.746p.

GenIP (LON: GNIP) is raising £350,000 at 7p/share and the cash will be used to fund new product development and additional staff. Earlier in the week, GenIP announced a strategic alliance with US-based professional services provider Cardinal IP. The two companies will sell each other’s products. CMC has been appointed as joint broker. The share price fell 33.2% to 6.85p.

Celsius Resources (LON: CLA) continues to make progress with the Maalinao-Caigutan-Biyog Copper-Gold project and the development of the mine and process plant, which is out for tender. Equinaire Holdings says it acquired the loan held by Makilala Mining Company in order to become involved in offtake arrangements. The share price slipped 29.2% to 0.46p.

ProService Building Services Marketplace (LON: PRO), formerly HSS Hire, says 2025-26 revenues from continuing operations is expected to be £248m, which is lower than forecast. That is due to a lower ramping up of the new arrangements with Speedy Hire and the weak construction market. The company is investing in further automation of its marketplace platform. Speedy Hire volumes are improving, and the deal should be earnings enhancing this year. Net debt was £27.2m at the end of March 2026 and the debt should be refinanced by August. Guidance for 2026-27 EBITDA is between £9m and £12m. Consensus was previously £19.6m. The share price declined 23.5% to 3.275p.

The FTSE 100 eased back on Friday as oil prices remained above $110 amid ongoing concerns about developments in the Middle East.

London’s leading index was trading down 0.5% at the time of writing, with reports swirling that the US was again considering military options.

London was one of the few stock markets open on Friday because of various holidays worldwide, including European Labour Day.

“The FTSE 100 took a step back on Friday on a mix of continuing concern about the situation in the Middle East, profit taking in the utilities sector and weakness among precious metals miners,” said AJ Bell investment director Russ Mould.

“The latest US earnings season has been robust, which has helped prevent global markets from suffering big losses despite the impact of the Iran conflict. US futures are pointing to another strong showing when trading resumes on Wall Street later. 

“But oil prices remaining above $110 per barrel are a reminder of the stakes for the global economy and the fact that there looks to be no path to the Strait of Hormuz reopening in the near term.”

FTSE 100 movers

Precious miner Endeavour Mining was the FTSE 100’s top faller as gold prices slipped again on Friday after a rather soggy week.

NatWest shares were among the losers after the bank released Q1 results that failed to inspire investors. The bank performed well during the period, and shares fell 3% largely due to the outlook.

“NatWest has delivered the kind of update bank investors can work with in a nervous market – not flawless, but profitable, well-capitalised and backed by better guidance,” said Matt Britzman, senior equity analyst, Hargreaves Lansdown.

“The profit beat wasn’t really about a surge in income, but about cost discipline, lower litigation costs and strong capital generation doing the heavy lifting. That puts NatWest in a similar camp to some of the other banks this week, where the economic outlook is looking a little more fragile as Middle East tensions feed into oil, inflation, and rate uncertainty, but higher-for-longer rates are also providing a useful buffer.”

DCC was the top riser after rejecting a bid approach, with investors clearly hoping it’s not the end of interest in the company.

Yesterday, Phoenix Copper (LON: PXC) announced that NIU Invest, the 11.7% shareholder, withdrew its requisition notice for a general meeting, but no reason was given. The share price gained 9.09% to 1.2p.

Iodine producer Iofina (LON: IOF) continues its upward momentum following better than expected figures for 2025 and upgrades to future years. A new large iodine plant will start production later this year leading to a big rise in production in 2027. More plants are in the pipeline. X-ray demand for iodine is keeping the price high and Canaccord is anticipating it staying above $70/tonne. The share price rose a further 2.565 to 40p, having been as high as 41.5p.

Atome (LON: ATOM) finance director Robert Sheffrin bought 33,147 shares at 60p each. This follows his subscription of 57,482 shares in the recent fundraising at 60p/share. The share price improved 4.13% to 63p.

FALLERS

GenIP (LON: GNIP) is raising £350,000 at 7p/share and the cash will be used to fund new product development and additional staff. CMC has been appointed as joint broker. The share price declined by two-fifths to 6.75p.

ADM Energy (LON: ADME) is raising £375,000 at 0.02p/share. The cash will be spent on increasing the interest in Vega Upstream JV to 35%. That should increase monthly revenues by $111,000. Another 375 million shares are being issued to pay creditors. Capital Plus Partners has been appointed broker. The share price fell 14.3% to 0.03p.

ProService Building Services Marketplace (LON: PRO), formerly HSS Hire, says 2025-26 revenues from continuing operations is expected to be £248m, which is lower than forecast. That is due to a lower ramping up of the new arrangements with Speedy Hire and the weak construction market. The company is investing in further automation of its marketplace platform. Speedy Hire volumes are improving, and the deal should be earnings enhancing this year. Net debt was £27.2m at the end of March 2026 and debt should be refinanced by August. Guidance for 2026-27 EBITDA is between £9m and £12m. Consensus was previously £19.6m. The share price dipped 12.15 to 3.395p.

Shield Therapeutics (LON: STX) generated revenues of $18m in the first quarter of 2026 with ACCRUFeR making $9.9m and a $7.9m milestone payment from China. The US sales continue to grow, but NY-Medicaid now requires prior authorisation for prescription approvals. The share price slid 13.15 to 7.6p.

Mkango Resources (LON: MKA) has filed a technical report under NI 43-101 definitive feasibility study report for the Songwe Hill rare earths project in Malawi. Songwe Hill’s post-tax NPV10 is $339m and payback is 3.4 years. There was cash of $3.1m at the end of 2025 and subsequently raised £11.7m at 33p/share. The share price is 5.38% lower at 44p.