Nick Raynor is an investment adviser at retail stockbroker, The Share Centre, having been there since 2002. Nick has over 11 years’ experience in personal finance. Nick is regularly asked to offer his insight on a wide range of financial matters to the UK media for papers including The Times and The Daily Telegraph. He provides weekly share comment to several regional newspapers, as well as finance-based websites such as MoneyExtra.com. He gives his thoughts on what to expect from companies announcing results w/c 7 June 2010.
Majestic Wine (LON:MJW) (preliminary results) - With the summer months approaching we would hope to see a good start to the new financial year as well as positive figures from the last 12 months. With the World Cup imminent this could give a pleasant boost to sales, however having already suggested that results would be at the upper end of analysts expectations, anything less will be a disappointment. We do not currently hold a view on Majestic wine
Tesco (LON:TSCO) (interim management statement) - Sir Terry Leahy may have announced his retirement, but the goliath that is Tesco’s will carry on and a short trading update will no doubt confirm this. Tesco has large overseas exposure and with Sterling suffering recent weakness this should give a boost to earnings, not that Tesco needs it. We expect another set of solid figures and can see no reason why we would change our ‘buy’ recommendation. We currently list Tesco as a BUY.
Sainsbury (J) (LON:SBRY) (Q1 trading statement) - To compete with Tesco Sainburys will have to produce something special we feel, however investors may not be totally interested in the figures. Investors will be looking for signs to see if there has been or will be any further interest from the Qatari Investment company that made a bid previously back in 2007. If not it will still be interesting to see how they have fared against other supermarkets over the last three months. We currently list Sainsburys as a HOLD.
Stobart Group (LON:STOB) (interim management statement) - Stobart Group has signed a number of contracts so far this year and the development of its Southend project is going well. We expect this update to contain further good news which should provide a boost to shareholders. An update in May noted that profits were up 54% and further improvements on margins are expected. Most recently Stobart received £100 million from the U.K. Companies Financing Fund, this 10 year loan will repay debt and will also be invested within the company. The future looks very promising hence the buy recommendation. We currently list Stobart as a BUY.
Carnival (LON:CCL) (Q2 results) - Figures should be boosted from currency fluctuations as the majority of Carnival’s business is US based, however this also could be an area for concern, the huge oil spill in the Gulf of Mexico could put those wanting to go cruising in that region off. These results are unlikely to change our stance to anything else but ‘hold’. We currently list Carnival as a HOLD.
Economic announcements for w/c 14 June 2010
Consumer Price Indices May 2010 (15 June) and Average Weekly Earnings (16 June)
April’s CPI rose to 3.7% from 3.4%. Recent figures from the Bank of England revealed that its preferred measure of the money supply, M4 minus Intermediate OFCs, expanded by 6.6% q/q, within the bank’s target range. The British Retail Consortium revealed a 1.8% y/y rise in shop price inflation in May, while food prices rose 2.2%. Average wages rose by 4% in March, the fastest pace for some time. The Bank of England has steadfastly stuck to its line that inflation will drop off later this year; markets will be looking for evidence to support this prediction.
Housing market survey May from RICS (15 June)
In the April survey from RICS, the index tracking new instructions (an indicator of changes in supply of properties for sale) fell from 21 to 11, while the new enquiries index (an indicator of changing demand) rose from zero to 8. If the pattern observed over the last two months continues, then in May the relationship between the two indices may have shifted in favour of demand growth, indicating house price rises further down the line. The imminent changes in capital gains tax may have led to a sharp rise in new instructions.
• Monthly Review of External Trade Statistics – April 2010 ONS
• Consumer Price Indices – May ONS
• Housing market survey – May RICS
• Eurozone Employment Q1 2010
• Eurozone Foreign Trade
• Labour Market Statistics ONS
• Average Weekly Earnings – April 2010
• Eurozone inflation May Eurostat
• US Consumer Price Index May, US Real Earnings May BLS
• Retail Sales – May ONS
• Public Sector Finance – May ONS
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