Weekly outlook: Europe set to count cost of macroeconomic turbulence

Key events for UK wealth managers for the week starting 21 November


Monday 21 November

  • – Full-year results from Virgin Money UK
  • – Trading statement from Compass
  • – In the US, quarterly results from Agilent, Zoom Video Communications and JM Smucker

Tuesday 22 November

  • – First-half results from HomeServe, Cranswick, Babcock and AO World
  • – Trading statement from CRH
  • – Japanese inflation figures
  • – UK government borrowing figures
  • – EU consumer confidence
  • – In the US, quarterly results from Medtronic, Analog Devices, VM Ware, HP Inc, Dell, Hormel Foods, HPE, Campbell Soup and Warner Music.

Wednesday 23 November

  • – Full-year results from Britvic
  • – First-half results from United Utilities, Johnson Matthey, Pets at Home, Halfords and De La Rue
  • – Trading statements from Rotork and Coats
  • – Interest rate decision from the Reserve Bank of New Zealand
  • – Flash purchasing managers’ indices for manufacturing and services from Asia, Europe, UK and USA
  • – US durable goods orders
  • – US flash purchasing managers’ indices
  • – US oil inventories
  • – In Asia, quarterly results from Tencent
  • – In Europe, quarterly results from Siemens Energy and Alstom
  • – In the US, quarterly results from Deere, Dollar Tree, BestBuy and Nordstrom

Thursday 24 November

  • – First-half results from Dr. Martens and JET2
  • – Trading statements from Kingfisher

On Thursday, Kingfisher will post its latest trading update. According to Susannah Streeter, Hargreaves Lansdown senior investment and markets analyst, the firm’s results could provide evidence of the extent of the impact the cost of living crisis is having on the UK’s largest companies.

She said: “Cost of living pressures are expected to show up in B&Q owner Kingfisher’s update as consumers make hard choices about how to spend their money. The big boom in DIY home improvements which played out during the pandemic has been fading. Now, with mortgage payments rising, and food and energy bills soaring, there is likely to be less disposable cash around and borrowing may be more difficult for major projects.

“An expected correction in the housing market could dent sales further if people put off moving and delay putting their stamp on a new property. However, some benefit could come from people opting to make small changes in current homes instead and demand for energy saving products like loft insulation is likely to stay strong. B&Q like other retailers has already been hit by higher energy costs which have eaten into margins but any sign that supply chain issues are continuing to ease will be well received given the problems snarl ups have caused.”

  • – In Asia, quarterly results from Meituan
  • – Thanksgiving Day in the US
  • – European economic surveys

In comparison to recent weeks, the coming seven days are set to be quieter. According to AJ Bell’s investment director Russ Mould and financial analyst Danni Hewson, the main top-down event of the week could come from two European economic surveys – the Ifo from Germany and the Courbe Syntethique (Synthetic Curve) survey from Belgium.

Mould and Hewson said: “Europe is wrestling with soaring inflation, higher energy costs and rising interest rates (just like the US and the UK) and these two indicators should be timely as central bankers and investors try to assess the damage done to the economic bloc.

“The Ifo should be useful because Germany is Europe’s largest economy, while the Courbe looks to be a pretty uncanny guide to the benchmark EuroStoxx 600 equity index. Both figures are due out on Thursday 24 November.

“In October, Germany’s Ifo Business Climate Index fell for the fifth month in a row to 84.3. That compared to 97.9 in the equivalent month in 2021 was the lowest score since May 2020, when Covid was the major concern. Respondents to the survey cited falling order books and sagging capacity utilisation rates at manufacturers, lower order backlogs in construction and downbeat sentiment among retailers.”

Friday 25 November

  • – Full-year results from Mitchells & Butlers
  • – Trading statement from Devro
  • – In Asia, quarterly results from Cathay Pacific Airways
  • London Stock Exchange Group (LSEG) Q3 trading update

LSEG is set to post its Q3 trading update on Friday, with analysts expecting the group’s equity trading income figures to be similar to levels seen at the same stage of its previous financial year, “but the slow-down in corporate deal-making could be impacting its capital markets revenues”, commented Steve Clayton, fund manager at Hargreaves Lansdown Select.

He said: “The exposure to the US market through the Russell Indices business will be a drag, given Wall Street weakness, but the drop in sterling could well save the day for the division. With the group able to access significant degrees of self-help as it unlocks the benefits from its earlier acquisition of Refinitiv, the LSEG should be one of the more reliable reporters in the current results season.”


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