The forward look from The Share Centre 2 Dec 2011

Nick Raynor, investment research analyst at The Share Centre, gives his thoughts on what to expect from companies announcing results w/c 5 December 2011.

Tuesday

Wolseley trading update

The group’s restructuring is almost complete and it’s focusing on improving customer service, maintaining market share and margins, cutting costs and cash generation. The update in October pointed to a weak medium term outlook, so investors will be keen to know if that trend is set to continue. The company is highly geared to the US housing sector picking up, however news has been far from encouraging.

We currently list Wolseley as a HOLD

Thursday 

Photo-Me-International interim results

Photo-Me-International issued a positive market update in October, despite overseas events potentially causing a hiccup. The company typically performs better in the first half of the year, so we will be looking for some impressive figures in this update. If we don’t see this it could raise concerns over estimates for the year.

We currently list Photo-Me-International as a BUY

Standard and Chartered trading update

Last month’s update from Standard Chartered pointed to slowing revenue growth, with growing concerns over its Indian business. Although the group is not involved with the problems in Europe it usually comments on the potential knock on effects to its business in Asia. Standard Chartered has also stated it is winning business from banks in Europe and the US as a direct result of the debt crisis. 

We currently list Standard and Chartered as a BUY

Tesco interim management statement

We expect this update to reiterate that UK trading conditions remain challenging. Growth seeking investors will be keen to hear how the company’s international operations are performing. However we expect the retailer to be making headway in both its UK and overseas businesses.

We currently list Tesco as a BUY

Economic Diary

Economic announcements for the w/c 5 December

5 December, PMI for services – Markit/CIPS

With the release of today’s Purchasing Managers Index PMI covering services, the November PMI story will be complete. Last month, the weighted average of the Markit/CIPS output indices covering manufacturing, construction and services fell from 52.7 in September, to 51. This was the second lowest reading since June 2009, but at least was a full point over the critical 50 no change mark, and therefore did not suggest the UK economy contracted during the month. But will the weighted average covering November suggest recession is on the way?

8 December, Governing Council meeting of the ECB in Frankfurt – ECB. Monetary Policy Committee Meeting and Announcement – Bank of England

Although the recent inflation report from the Bank of England makes it clear the MPC is not considering upping interest rates for some time, and may announce more QE in due course, it is unlikely today’s meeting will see any significant changes. There is a limitation to how quickly the bank can complete asset purchases, and as such it has not yet fully completed the QE programme it announced in October. More interest may focus on the ECB, which may announce another rate cut today, although it seems likely the next cut in euro interest rates will occur nearly next year.

Other economic announcements include:

5 December

•PMI for services – Markit/CIPS

•PMI for US non manufacturing  

•PMI services Eurozone – Markit 

6 December

•EU National accounts GDP, Q3, second estimate – Eurostat

•Mergers and Acquisitions involving UK companies – Q3 2011 – ONS

7 December

•Index of Production, October 2011 – ONS

8 December

•Governing Council meeting of the ECB in Frankfurt – ECB

•Monetary Policy Committee Meeting and Announcement – Bank of England 

•Foreign Direct Investment, 2010 SB – ONS

9 December

•US International Trade, October – Census and BEA

•UK Trade, October 2011 – ONS

•Producer Price Index,  November 2011 – ONS

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2011-12-02 11:19:52 © Moneyextra.com