The Week Ahead: Worry ahead of British banks' interim results
Monday 01 August 2011
With the five major UK banks releasing interim results this week, their global peers have seemingly been doing their best to dampen sentiment.
In the US, Bank of America recently reported its worst-ever quarterly loss, while in Europe last week Credit Suisse, Deutsche Bank and UBS all managed to disappoint investors.
Investment banking has been particularly poor – a worrying trend for HSBC, which is today expcted to confirm at least 10,000 job cuts. Morgan Stanley expects it to have seen a slowdown in that area, but believes this will be countered by Asia, resulting in revenues across the group staying steady.
The eurozone debt crisis continues to weigh on shares of banks, including Barclays, but Investec notes that the group's large exposures are to Portugal and Italy rather than Ireland and Greece. Its analysts expect Barclays to reveal a net attributable loss of £29m on Tuesday, after setting aside £1bn for Payment Protection Insurance mis-selling claims.
Ireland, however, is seen as a major issue for Royal Bank of Scotland and Lloyds by Morgan Stanley, which report on Friday and Thursday respectively. The broker predicts the repayment of Government support will also weigh on Lloyds results. Perhaps the fewest concerns are around Standard Chartered's figures on Wednesday, after its update in June, which revealed income and profits rose more than 10 per cent in the first five months of the year.
Results/Updates: Fidessa, Hammerson, Hiscox, HSBC, Intertek, Keller, Senior and Ultra Electronics.
The engineer Weir Group announces its interim results on Tuesday, with the group – which manufactures pumps for the oil and gas sector – currently enjoying its share price trading close to a record high. Goldman Sachs, however, believes there is more upside ahead, predicting that the next stage of the company's growth will come from its minerals division.
"As a result," say the broker's analysts, "we look for positive signs that the enquires relating to the potential mining 'mega projects', which were discussed at the full-year results, are turning into concrete orders for Weir."
They also believe there will be good news from its well equipment business SPM, although they note that a recent investors' day focused on the unit and therefore bullishness on its performance "is likely to be in the share price".
Results/Updates: Barclays, Capital Shopping Centres, Centamin Egypt, Cookson, Devro, Drax, Elementis, Fresnillo, Meggitt, Millennium & Copthorne Hotels, moneysupermarket.com, QinetiQ, Rotork, SDL, Tullett Prebon, Weir and Xstrata.
House prices may be showing few signs of improvement, but that hasn't stopped Rightmove, with the property website's shares doubling in less than a year. Wednesday sees its interim figures, and UBS expects "another confident results statement" with first-half revenues up more than 18 per cent to £46.4m.
Results/Updates: Antofagasta, Capital & Counties Properties, ENRC, F&C Asset Management, Ferrexpo, GKN, Legal & General, Rexam, Rightmove, Standard Chartered, Taylor Wimpey and WS Atkins.
After legal & General anounces its figures on Wednesday, and before Prudential has its turn on Friday, Aviva and RSA Insurance continue the first-half reporting season for the insurers on Thursday. The numbers from Aviva follow a positive trading statement for the first three months, and JPMorgan Cazenove believes that when it announced the disposal of its RAC business in June, "the implicit message ... was also that the operating performance remains good". The broker is expecting Aviva's operating earnings to rise 5 per cent, driven by "continued strong performance in its non-life business". However, JPMorgan's analysts note that Aviva's earnings will take a knock after the recent sale of part of its stake in Delta Lloyd, which means the Dutch insurer will be deconsolidated from the group's balance sheet.
Citigroup's Raghu Hariharan, meanwhile, thinks RSA Insurance will report a net income of £234m, and points out the company has "already indicated that adverse weather and Japanese earthquake claims would total around £45m for the half-year".
Results/Updates: Aviva, British Land, Catlin, Cobham, easyJet, Enterprise Inns, Inmarsat, Ladbrokes, Lloyds Banking Group, Rio Tinto, Robert Walters, RSA Insurance, Schroders, Spirent, Unilever and Victrex.
Results/Updates: BBA Aviation, Bellway, Logica, Old Mutual, Premier Foods, Prudential, RBS, Smith & Nephew and William Hill.
CBI economic forecast; CIPS manufacturing PMI; US construction spending; US manufacturing ISM.
CIPS construction PMI; US personal income; US personal spending.
Bank of England Monetary Policy Committee meeting; CIPS services PMI; Official reserves data; Shop price index.
Bank of England interest rate decision; Car registration figures.
Insolvency data; Producer prices; US consumer credit; US payrolls data.
- 1 Scottish referendum: So how about the English now being given a chance to split from England?
- 2 Friends 20th anniversary: Alison Jackson photographs reunited cast
- 3 London council removes 'unacceptable' Stamford Hill posters telling women which side of the road to walk down
- 4 The response to my Pizza Express review has been overwhelming, and taught me a lot about journalism
- 5 Free U2 album: How the most generous giveaway in music history turned into a PR disaster
Scottish independence referendum: Frankie Boyle reacts to nation's 'No' vote - 'To be fair, I've always hated Scotland'
London council removes 'unacceptable' Stamford Hill posters telling women which side of the road to walk down
Iranian blogger found guilty of insulting Prophet Mohammad on Facebook sentenced to death
Scottish referendum: Police struggle to control Unionist rally in Glasgow's George Square
Hitler’s former food taster reveals the horrors of the Wolf’s Lair
Daniele Watts: Django Unchained actress detained by Los Angeles police after being mistaken for a prostitute
Scottish independence referendum: A nation divided against itself
Scottish referendum results: Cross-party consensus collapses amid Tory-Labour spat on the 'English question'
Scottish independence: David Cameron is becoming the 'George Bush of Britain'
Russia freezes Ukraine into submission: Kiev admits country doesn't have enough fuel for winter
Scottish independence: The Queen breaks silence on referendum debate – as think tank warns of £14bn black hole if Scotland votes Yes
iJobs Money & Business
£400 - £450 Per Day: Clearwater People Solutions Ltd: **URGENT CONTRACT ROLE**...
Up to £100k or £450p/d: Saxton Leigh: My client is a leading commodities tradi...
£320 - £330 per day: Ashdown Group: The Ashdown Group have been engaged by a l...
To £75,000 + Pension + Benefits + Bonus: Saxton Leigh: My client is looking f...