Yahoo Finance Week ahead in business and finance
Today
No FTSE 350 companies reporting.
Tomorrow
Apple chipmaker IQE will be looking to dispel any lingering doubts over its book-keeping in its full-year figures after prominent activist short-sellers Muddy Waters and ShadowFall lambasted the company’s accounting practices.
The Welsh Aim-listed company has denied any wrongdoing and parachuted in auditor KPMG after being accused by Muddy Waters of being an “egregious accounting manipulator”. It provides technology for the iPhone X’s facial recognition sensors, and its performance from Apple’s latest flagship product will be tomorrow’s key sentiment driver.
A shortage of delivery drivers weakened online grocer Ocado’s end to 2017 but its first quarter of the new financial year should not have been affected, according to Peel Hunt’s James Lockyer.
Ocado’s fortunes have been transformed by securing its first three contracts overseas and it raised £143m in a shares placing last month to fund its transformation into a technology company. It has warned investors that earnings are likely to be hit by the heavy investment needed for the shift.
Full-year results: 888 Holdings, Hansteen, IQE, John Wood
Interim results: Bellway
Trading update: Ocado
Economics: Inflation data (UK), House price index (UK), Consumer confidence (EU)
Wednesday
Kingfisher’s ailing French business will be back under investor microscopes as its Screwfix division attempts to hold back the tide at the FTSE 100 company.
A digital-fuelled sales surge has boosted its trade-focused Screwfix business but Kingfisher is likely to flag a more challenging consumer backdrop in its long-awaited update to investors, broker Jefferies warned clients. Discernible progress on the company’s five-year ONE strategy shift will be in focus but the outlook for B&Q and French businesses Brico Dépôt and Castorama will be the main share price mover.
Full-year results: Ferrexpo, International Public Partnerships, Kingfisher, Vectura
Interim results: Softcat
Economics: Labour data (UK), Public sector net borrowing (UK), CBI industrial trends survey (UK), Existing home sales (US), Federal Reserve monetary policy decision (US)
Thursday
Ted Baker shares are riding high after the retailer brushed aside the gloom engulfing the sector in 2017.
Analysts pinned its outperformance on heavy investment in its website and technology systems, helping it ride the e-commerce wave, outmanoeuvring its less nimble peers.
Boss Ray Kelvin also credited its large international business and its higher priced clothes for helping it swallow pricier import costs. Its weaker US business will be back under the spotlight and hopes will be high after better-than-anticipated results by retailers in the States, broker Jefferies told clients.
Full-year results: Ted Baker
Trading update: Halma, IG
Economics: Retail sales (UK), Bank of England monetary policy decision (UK), Composite PMI index (US & EU)
Friday
Next’s Christmas sales also defied the strong headwinds blowing its other high-street peers off course but warned investors that many of the challenges faced by the retail sector last year will persist.
Cooling inflation in 2018 should ease the pressure on retailers and Next has pumped investment into its online offering to fend off the other major challenge facing the sector: shoppers’ shift from bricks to clicks.
However, its high-street stores still account for a “huge slice of sales” and with inflation remaining close to a five-year high “it’s likely to be far from plain sailing”, Hargreaves Lansdown’s George Salmon warned.
Full-year results: Next
Interim results: Smiths
Economics: Durables (US), New home sales (US)
Economics
British economy-watchers have a treat in store for them this week.
Tomorrow’s February inflation data from the Office for National Statistics is expected to show a small fall in CPI as price rises fall back from 3pc.
Wednesday’s jobs numbers are set to show weekly wages rose by 2.6pc in the 12 months to January, showing signs of life which could soon mean earnings are rising faster than prices, relieving the squeeze on household finances.
Wages are creeping up because unemployment is down at 4.4pc, forcing employers to cough up more to get and keep the workers they need.
On Thursday the Bank of England’s MPC meets to consider the implications of this for interest rates. No action is expected at this meeting, but Mark Carney may give more indications of a plan for a rate rise in May.
Meanwhile on the other side of the pond new US Federal Reserve chairman Jerome Powell holds his first meeting.
He is expected to hike interest rates, from 1.5pc to 1.75pc. His words will be picked over for hints at more hikes this year.
