Week Ahead: Budget, BoE minutes, Next

18th Mar 2011 12:03

Thursday is normally the biggest day of the week for the London stock market but next week Wednesday takes the honours, as that's the day the minutes from the most recent meeting of the Monetary Policy Committee (MPC) are released, and it is also the day the Chancellor of the Exchequer, George Osborne, delivers his second Budget speech.The MPC has become progressively more hawkish on the interest rate front as UK inflation stubbornly refuses to head south. For a long time Andrew Sentance had been the lone voice on the MPC voting for a hike in interest rates, but the ranks of the hawks grew to three in February and economists are curious to learn whether any more have "gone over to the dark side".Bank of England governor Mervyn King is a committed dove, however, and his deputy, Charles Bean, also seems likely to have remained in the doves camp at the last vote.In an interview this week with The Times newspaper Bean came out in favour of a "wait and see" stance on policy tightening after the shock contraction in gross domestic product (GDP) in the fourth quarter."The question is does that indicate the recovery running out of steam or not ? It could just be rogue data, it could just be a temporary soft patch. We know economies often go through soft patches during recoveries, but it might indicate a more durable slowing, possibly connected with people becoming more concerned about the impact of the fiscal consolidation," Bean said.As for the Chancellor's Budget speech, Osborne has promised a finance bill that is "unashamedly pro-growth, pro-enterprise and pro-aspiration," as he seeks to move the UK economy from rescue mode to reform mode.The aforementioned fourth quarter contraction in GDP might have put a crimp in his plans, however, but on the plus side the tax coffers have been fuller than expected in recent months. This could give him some scope to throw the plebeians a bone or two, with some sort of petrol price rise capping mechanism being one of the ideas being widely forecast, or, at least, an abandonment of the previous administration's 1p rise in fuel duty.The Chancellor is probably itching to cut tax rates but probably does not have the scope to cut personal income tax just yet though an acceleration of his previously announced plan to cut a penny per pound off corporation tax each year is possible, though a bit of a long shot.One of Osborne's predecessors, Gordon Brown, was a great one for fine tuning and tweaks here and there to the tax apparatus which has made the whole tax and benefits system unnecessarily complex in the eyes of many. Another of Osborne's predecessors, Nigel Lawson, used to like to get rid of one tax every year and Osborne may be inclined to revive this or even top Lawson and get shot of a whole bundle of red tape in one go.Moving the focus to company results, Thursday has a fashionable look to it, with retailers Next and Ted Baker both reporting.Next will most likely be relying on its online and catalogue arm, Next Directory, to drive growth. Charles Stanley is forecasting operating profit at Next Retail will be flat at £320m, though the operating margin should improve by one-fifth of a percentage point. It thinks Next Directory will report a 22% rise in operating profit to £225m, with the operating margin expanding by two percentage points to 24%. Next Directory's total sales are expected to be up by 6% to £925m, driven by a higher number of active customers and a wider product range, Charles Stanley says."Like for like sales [at Next Retail] are expected to be down by c.4%, with trading having slowed through the year as comparatives and the consumer environment became tougher. Total sales are anticipated to be broadly flat at £2,225m, supported by the addition of new space. At the interim stage, guidance was for total space to grow by c.6% in 2010/11, with a net 19 new store openings (including 12 standalone Home stores)," the broker said.Group revenue is forecast to be £3,485m, up from £3,407m the year before, putting Charles Stanley above the market consensus of £3,464m.The market thinks profit before tax will be £550.6m, up from £505m the year before, but here Charles Stanley is below consensus with its forecast of £548m.Ted Baker, like Next, has a financial year running to the end of January, to enable the January sales to be factored into its figures. The retailer lifted sales by 7.6% over the Christmas period, though this total was hit by the weather disruption. The firm does not give like-for-like comparisons, but says average retail square footage increased by 6.6% over the period to 223,623 sq.ft.The market has pencilled in pre-tax profit of £24m on sales of £186.4m. Monday March 21INTERIMSNautical Petroleum, Netcall, PureCircle Ltd. (DI), Renewable Energy Generation Ltd.INTERIM DIVIDEND PAYMENT DATESystem C HealthcareINTERNATIONAL ECONOMIC ANNOUNCEMENTSPMI Manufacturing Survey (FRA) (8.00) PMI Service Sector Survey (FRA) (8:00)Chicago Fed National Activity Index (US) (12.30) Existing Home Sales (US) (14:00)UK ECONOMIC ANNOUNCEMENTSRightmove House Prices (00:01)GMSNetwork Group HoldingsFINALSPhotonstar LED GroupANNUAL REPORTDialightEGMSBellzone Mining, Commercial International Bank (Egypt) SAE GDR (Reg S)AGMSCommercial International Bank (Egypt) SAE GDR (Reg S), Zhejiang Southeast Electric Power Co Ltd. GDR (Reg S)Tuesday March 22INTERIMS1Spatial HoldingsINTERIM DIVIDEND PAYMENT DATEGartmore Irish Growth FundGMSGartmore Irish Growth Fund, JJB SportsFINALSAtlantic Global, Cairn Energy, Corin Group, Dolphin Capital Investors Ltd., DRS Data & Research Services, Energetix Group, Forth Ports, Instem Life Science Systems, Morson Group, Planet Payment Inc. (Reg S), Severfield-Rowen, Shore Capital Group Ltd., Source BioScience, Vphase, XaarIMSSSouthern Cross Healthcare GroupEGMSDatang International Power Generation Co Ltd., Henderson GroupAGMSAndor Technology, Southern Cross Healthcare Group, St. Modwen PropertiesTRADING ANNOUNCEMENTSDolphin Capital Investors Ltd.INTERNATIONAL ECONOMIC ANNOUNCEMENTSSupermarket Sales (JPN)Convenience Store Sales (JPN)Richmond Fed Manufacturing Index (US) (14.00) UK ECONOMIC ANNOUNCEMENTSConsumer Price Index (09:30)Retail Price Index (09:30)Public Sector Finances (09:30)CBI Industrial Trends Surveys (11:00)FINAL DIVIDEND PAYMENT DATEFramlington AIM VCTQ1CarnivalWednesday March 23INTERIMSFinsbury Food Group, Smiths GroupINTERIM DIVIDEND PAYMENT DATEMedusa Mining Ltd. (DI)INTERIM EX-DIVIDEND DATEBrooks Macdonald Group, Close Brothers Group, Craneware, Go-Ahead Group, London Finance & Investment Group, NWF Group, Photo-Me International, Thorntons, Tristel, Utilico Investments Ltd (DI), Waterman GroupQUARTERLY PAYMENT DATEFrontline Ltd.QUARTERLY EX-DIVIDEND DATEPremier Energy & Water Trust, Real Estate Credit Investments Ltd.INTERNATIONAL ECONOMIC ANNOUNCEMENTSIndustrial New Orders (EU) (10:00)Consumer Confidence Indicator (EU) (10:00)MBA Mortgage Applications (US) (11:00)Crude Oil Inventories (US) (14:30)New Homes Sales (US) (14:00)Q4Eastern Platinum Ltd.GMSLansdowne Oil & Gas, Real Office GroupFINALS21st Century Technology, @UK, Alliance Pharma, Cyprotex, Eastern Platinum Ltd., Espirito Santo Financial Group SA, Eurasian Natural Resources Corp., Hansteen Holdings, Henry Boot, Huntsworth, Landkom International, Lighthouse Group, Lupus Capital, Melrose Resources, National Bank of Greece ADR, Plaza Centers NV, Portmeirion Group, Proximagen Group, S & U, StatPro Group, VislinkSPECIAL EX-DIVIDEND PAYMENT DATEUtilico Investments Ltd (DI)AGMSBeazley, Chrysalis VCT, Heavitree Brewery, Safestore HoldingsTRADING ANNOUNCEMENTSSainsbury (J)UK ECONOMIC ANNOUNCEMENTSBBA Mortgage Lending Figures (09:30)BoE Interest Rate Minutes (09:30)Chancellor Budget Statement (12:30)FINAL EX-DIVIDEND DATEAll Leisure Group, Amlin, Aviva, Braime (T.F.& J.H.) Holdings (Non-Voting), Cenkos Securities, Chemring Group, French Connection Group, Hotel Corp., InterContinental Hotels Group, Low & Bonar, Maintel Holdings, Millennium & Copthorne Hotels, Promethean World, Schroders, Schroders (Non-Voting)Thursday March 24INTERIMSClearStream Technologies Group, Clinton CardsQUARTERLY PAYMENT DATEVirgin Media Inc.INTERNATIONAL ECONOMIC ANNOUNCEMENTSConsumer Prices Index (JPN)Business Confidence Indicator (FRA)Own Company Production Outlook (FRA) (07.45) PMI Manufacturing Survey (GER) (08.30) PMI Service Sector Survey (GER) (08.30) PMI Manufacturing Sector Survey (EU) (08.30) PMI Service Sector Survey (EU) (08.30) PMI Composite Index (EU) (08:30)Jobseekers Net Change (FRA) (17:00)Continuing Claims (US) (12:30)Durable Goods Orders (US) (12:30)Initial Jobless Claims (US) (12:30)GMSMcbrideFINALSAbbey Protection, BrainJuicer Group, EG Solutions, Kingfisher, M&C Saatchi, Next, office2office, Premier Oil, PV Crystalox Solar, Resolution Ltd., Salamander Energy, ServicePower Technologies, Sopheon, Sportech, Ted BakerANNUAL REPORTNational Express GroupAGMSAcuity Environmental VCT, Autonomy Corporation, Chemring Group, Independent Inv TrustTRADING ANNOUNCEMENTSImperial Tobacco Group, United Utilities GroupUK ECONOMIC ANNOUNCEMENTSInternet Retail Sales (09:30)Retail Sales (09:30)Friday March 25INTERIMSBrewin Dolphin HoldingsINTERIM DIVIDEND PAYMENT DATEAquarius Platinum Ltd., Downing Distribution VCT 2 , Hargreaves Services, Heath (Samuel) & Sons, Ruffer Investment Company Ltd., Scottish & Southern EnergyQUARTERLY PAYMENT DATERoyal Dutch Shell 'A', Royal Dutch Shell 'B'INTERNATIONAL ECONOMIC ANNOUNCEMENTSGDP (FRA) (06:30)GfK Consumer Confidence (GER) (07:00)Consumer Confidence Indicator (FRA) (07:45)IFO Business Climate (GER) (09:00)IFO Current Assessment (GER) (09:00)IFO Expectations (GER) (09:00)M3 Money Supply (EU) (09:00)GDP (Final) (US) (12:30)Personal Consumption (US) (12:30)U. of Michigan Confidence (Final) (US) (14:00)FINALSInvista Real Estate Investment Management Holdings, Songbird Estates, TawaANNUAL REPORTBrit Insurance Holdings NV (DI), SpectrisEGMSDevelica Deutschland Ltd., Dexion Commodities Ltd. EUR Shares, Dexion Commodities Ltd. GBP Shares, Dexion Commodities Ltd. USD Shares, Integra Group GDR (Reg S), PJSC Novorossiysk Comm. Sea Port GDR (Reg S)AGMSAcuity VCT 3, Macquarie Korea Infrastructure Fund GDRSTRADING ANNOUNCEMENTSAlpha Tiger Property Trust Ltd.UK ECONOMIC ANNOUNCEMENTSPublic Sector Finances (09:30)FINAL DIVIDEND PAYMENT DATEBrunner Inv Trust, Henderson Opportunities Trust, LPA Group, Sanderson Group, Throgmorton Trust