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 What happens to your body when you give up sugar?
- 2 This is what the photographer has to say about the picture of a weasel riding a woodpecker
- 3 Delhi bus rapist blames dead victim for attack because 'girls are responsible for rape'
- 4 Have sex with your iPad thanks to the new sex toy no-one asked for
- 5 Average penis size revealed: Scientists attempt to find what is 'normal' to reassure concerned men
Bill Clinton portrait features Monica Lewinsky reference, artist admits
Japanese island overrun with cats after population explodes
Delhi bus rapist blames dead victim for attack because 'girls are responsible for rape'
Pornhub turns masturbation into energy in bid to save the planet
The 'sex selfie stick' lets you FaceTime the inside of a vagina
New theory could prove how life began and disprove God
'Jihadi John': CAGE representative storms off Sky News accusing Kay Burley of Islamophobia
This is what it's like to be dead, according to a guy who died for a bit
Durham Free School: 'Creationism taught at' free school facing closure
Ukip would cut billions from Scottish budget to fund English tax cuts
Nearly 100,000 of Britain's poorest children go hungry after parents' benefits are cut
iJobs Money & Business
£15000 - £18000 per annum: Recruitment Genius: This is a great opportunity for...
£50000 - £60000 per annum + Excellent Salary: Austen Lloyd: An outstanding new...
£20000 - £21000 per annum + uncapped commission: SThree: As a graduate you are...
£25000 - £30000 per annum + benefits: Ashdown Group: A global leader operating...