Wednesday preview: BoE inflation report, Sainsbury, Kesa

10th May 2011 16:25

The pressure on the Bank of England to raise interest rates has eased since April's surprise decline in the annual inflation rate, but it is probable that the Bank's Monetary Policy Committee (MPC) will raise its near-term inflation forecast when it releases the May inflation report on Wednesday.The MPC's remit is to ensure that inflation hovers on or around the 2% level, and the official line has been that the rate will start returning towards the target level once certain exceptional items - the January VAT rise, soaring commodity prices - work their way through the system. The question at the forefront of many economists' minds is when will the rate get back on target? The Bank of England has been obliged to extend the deadline for a return to the target range progressively into the future and it is probable that it will do so again on Wednesday. On the corporate front supermarket behemoth J. Sainsbury issues full year results on Wednesday for the year to end of March. Market consensus is for sales of £21.34bn and profit before tax of £661.8m.Matrix Group says "the market is expecting an update on the property valuation and an improvement on the £10.2bn the company announced in November 2010, but, with no rationale for a move to an 'opco/propco' [operating company/property company], the changes are not especially relevant, in our view."The broker is expecting underlying profit growth of 10% but remains bearish on the stock, noting that top line growth is slowing and the stock is valued on an earnings multiple around 10% higher than the sector.Kesa Electricals, the owner of Comet stores in the UK and Darty in France, brings out a full-year trading update and since it last updated the market four months ago its main UK rival, Dixons, has warned of how tough things are in the UK.Singer Capital Markets, reading across from Dixons' statement, reckons conditions will have worsened in the UK for Kesa since January but predicts that Darty will have had a positive outcome in the fourth quarter, as the chain goes up against soft comparatives from the corresponding period of 2010. INTERIM EX-DIVIDEND DATEAberdeen Asset Management, Animalcare Group, Numis Corporation, Redefine International, Sage Group, Smart (J) & Co., Smiths News, TawaQUARTERLY EX-DIVIDEND DATEBP, ING UK Real Estate Income Trust Ltd., Royal Dutch Shell 'A', Royal Dutch Shell 'B'INTERNATIONAL ECONOMIC ANNOUNCEMENTSConsumer Price Index (GER) (07:00)Current Account (FRA) (07:45)MBA Mortgage Applications (US) (12:00)Balance of Trade (US) (13:30)Crude Oil Inventories (US) (15:30)Treasury Budget Statement (US) (19:00)FINALSDatatec Ltd. (DI), Sainsbury (J), Vertu MotorsIMSSBeazley, John Wood Group, Prudential, Rathbone Brothers, Restaurant Group, SIGSPECIAL EX-DIVIDEND PAYMENT DATEFidessa GroupAGMSAlbion Development VCT, Albion Development VCT 'D' Shares, Anglogold Ashanti Ltd., Arbuthnot Banking Group, Clarkson, Dairy Farm International Holdings Ltd. (Singapore), Glanbia, Goldenport Holdings Inc., Hardy Oil & Gas, Hellenic Carriers Ltd., Highcroft Investment, Hongkong Land Holding Ltd. (Singapore), Hygea VCT, International Personal Finance, ITV, John Wood Group, KBC Advanced Technologies, Landkom International, London Mining, Mandarin Oriental International (Singapore), Marshalls, Mithras Inv Trust, Ocado Group, Optimal Pay, Pittards, Rathbone Brothers, Rentokil Initial, Restaurant Group, Ruukki Group (DI), UnileverUK ECONOMIC ANNOUNCEMENTSBalance of Trade (09:30)BoE Inflation Report (09:30)FINAL DIVIDEND PAYMENT DATEBlackRock World Mining Trust, CQS Rig Finance Fund Ltd., Dealogic Holdings, Novae Group, Standard Chartered, WSP GroupFINAL EX-DIVIDEND DATEAdvanced Medical Solutions Group, Axis-Shield, BlackRock Smaller Companies Trust, British Smaller Companies VCT 2, Bunzl, Cape, Computacenter, CSR, Downing Planned Exit VCT 8, Downing Planned Exit VCT 9, Fidessa Group, Gresham House, Hardy Underwriting Bermuda Ltd. (DI), Hiscox Ltd., Hochschild Mining, Hydrogen Group, Inmarsat, Irish Continental Group Units, Lamprell, Macfarlane Group, Matrix Income & Growth VCT, Morrison (Wm) Supermarkets, Nationwide Accident Repair Services, Northbridge Industrial Services, Ocean Wilsons Holdings Ltd., Octopus Second AIM VCT, Pinewood Shepperton, Provident Financial, PV Crystalox Solar, Quarto Group Inc., Randgold Resources Ltd., Rexam, Rightmove, Scisys, STM Group, Ted Baker, WhitbreadQ1Ruukki Group (DI)---jh