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What to Expect from the Week Ahead

With the Greek referendum off the agenda, markets are free to worry about economic data once again

Morningstar.co.uk Editors 4 November, 2011 | 5:11PM
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Attention may switch back to the relative strength of China, where loan growth and retail sales figures this week should provide some clues to the strength of its continued recovery. There are also important economic statistics from the Eurozone, which will show the extent to which the Euro crisis is weighing on recovery there.

The week starts slowly, with a market update from Rentokil and interim management statements from Telecity and Xchanging, but little to divert the market. There are a slew of retail results on Tuesday with Marks & Spencer and Carphone Warehouse giving half-year figures. Management comments on the relative strength of the consumer going into the important Christmas period will be widely watched. Associated British Food, Vodafone and Babcock also release results.

On Wednesday, it’s the turn of Sainsburys. Interim results from the retail giant will provide some insight as to whether the UK consumer is rolling over. The group will be rewarded if it shows any sign of putting a dent in Tesco’s dominance and markets will be watching the success or otherwise of its store opening programme. Great Portland Estates also reports interim results today.

Media group Euromoney Institutional Investor has full-year results on Thursday, while Halfords, Dairy Crest, Land Securities and Vedanta Resources all release interim results. For Vendanta, investors will be monitoring if the recent poor run for commodities and worries over global growth has hit the group’s prospects. Halfords has also had a difficult run and management’s view on prospects will be closely watched. Oriel Securities has recently suggested that the group’s downgrade cycle may be coming to an end.

It is all quiet on Friday, with just Hornby and Carr’s Milling Industries reporting results. The Rolls-Royce interim management statement will be observed with interest, however.

Monday
The week kicks off with retail sales figures from the Eurozone. Markets are expecting them to show a moderate drop of 1%. Any significant weakening, particularly in Germany, is likely to spook markets. House price data from the UK is also likely to be closely watched.

Tuesday
Today sees industrial production and manufacturing figures from the UK. Consensus expectations are that manufacturing will show a slight rise of 1.5% year on year, but recent PMI data suggests it may not be as buoyant as hoped.

Wednesday
China makes most of its announcements today. It reports retail sales figures and markets are expecting strong growth of 17% year on year. Inflation figures will also be closely watched to see whether recent rate rises have got the problem under control. There are also a number of business confidence surveys from the Eurozone, which will provide some insight into whether the region is slipping back into recession.

Thursday
The UK monetary policy committee will make its latest interest rate announcement today. Rates are likely to remain unchanged, but all eyes will be on the asset purchase target announcement and the extent to which it is likely to boost the economy. There are also consumer confidence indictors from the US and some jobs data. Markets will be looking at whether the private sector is showing strong enough growth to ease the worries over the US economy.

Friday
Today sees a report from the widely watched University of Michigan consumer confidence index in the US. China is also releasing loan data, which should give an indication of the pace of economic expansion. From the UK, there is producer price data.

The information contained within is for educational and informational purposes ONLY. It is not intended nor should it be considered an invitation or inducement to buy or sell a security or securities noted within nor should it be viewed as a communication intended to persuade or incite you to buy or sell security or securities noted within. Any commentary provided is the opinion of the author and should not be considered a personalised recommendation. The information contained within should not be a person's sole basis for making an investment decision. Please contact your financial professional before making an investment decision.

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Morningstar.co.uk Editors  analyse and report on shares, funds, market developments and good investing practice for individual investors and their advisers in the UK.