HSBC set for $6.1bn profit ahead of cost-cutting programme

HSBC is expected to announce a $6.1bn (£3.7bn) pre-tax profit for the first quarter ahead of a restructuring on Wednesday.

Despite analysts at Nomura forecasting that pre-tax profit will be 7 per cent up on the first three months of last year, its chief executive, Stuart Gulliver, will announce cost-cutting plans. These are expected to focus on the bank's retail division. One option is to move that team's staff away from the Canary Wharf headquarters to a cheaper location. Layers of middle management might also be taken out.

The Wednesday meeting is when Mr Gulliver is expected to explain how the bank will change over the next five years.

Imperial Tobacco also announces its interim results on Tuesday. No surprises are expected in what should be profitable figures, but the City will be looking for the group's reaction to proposed Government changes to tobacco laws. In March, the Health Secretary, Andrew Lansley, announced plans to limit the display of cigarettes. He is also studying plain packaging.

The Government will be hoping for good figures from the Bank of England's quarterly inflation report. A hike could lead to higher interest rates.