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The Week Ahead: Markets waits for news of disposals from Morrisons

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Thursday is a big day for two retailers that have seen better times: Morrisons and Home Retail Group.

Supermarket firm Morrisons is playing catch-up in the online and convenience store arenas, and there have been rumours swirling around about management pondering releasing capital for the turnaround plan through a sale-and-leaseback programme of its store portfolio.

Broker Jefferies said the full-year results should provide investors with Morrisons’ plan to tackle strong pressures in the core estate.

“We expect a gradual shift to stronger EDLP [every day low pricing] backed by more targeted promotional dynamics. A confirmation of rapidly falling capex and potential disposal of non-core property is also likely,” the broker believes.

“Market expectations are for an unchanged dividend this year, despite broadly flat sales, a lower operating margin and higher interest charge,” reckons Charles Stanley.

The broker thinks the focus will be on outlook comments and financial guidance for 2014/15, especially since the company has already tipped the wink (back in January) that full-year profits would be at the lower end of expectations.

Home Retail Group, which owns the Argos and Homebase brands, is further along the turnaround trail than Morrisons, as evidenced by its January trading statement when it said full-year group benchmark profits would be towards the top end of the current range of market expectations of £90mln to £109mln.

Security services firm G4S is another turnaround story, and the market will be keen to hear on Wednesday of the new management’s progress on restoring the group’s reputation with the UK government.

Significant announcements expected

Monday

Companies: Finals: Clarkson (LON:CKN), Deltex Medical Group (LON:DEMG), Escher Group (LON:ESCH), Goals Soccer Centres (LON:GOAL). Interims: Goldplat (LON:GDP), Pure Wafer (LON:PUR).

Economic: EU: French Industrial Production, Italian Industrial Production, Sentix Investor Confidence.

Tuesday

Companies: Finals: Computacenter (LON:CCC), Empresaria Group (LON:EMR), esure Group (LON:ESUR), Foxtons Group (LON:FOXT), Hill & Smith Holdings (LON:HILS), Hansteen Holdings (LON:HSTN), Inchcape (LON:INCH), Stadium Group (LON:SDM), Tyman (LON:TYMN). Interims: Close Brothers Group (LON:CBG), Craneware (LON:CRW), KALIBRATE TECHNOLOGIES (LON:KLBT), St Ives (LON:SIV). Trading Statement: Fenner (LON:FENR).

Economic: UK: BRC Retail Sales Monitor, Manufacturing Production, Industrial Production, NIESR GDP Estimate. EU: German Trade Balance. US: NFIB Small Business Index, JOLTS Job Openings, Wholesale Inventories.

Wednesday

Companies: Finals: Access Intelligence (LON:ACC), Cloudbuy (LON:CBUY), French Connection Group (LON:FCCN), Ferrexpo (LON:FXPO), G4S (LON:GFS), Glanbia (LON:GLB), Hikma Pharmaceuticals (LON:HIK), Hochschild Mining (LON:HOC), Kenmare Resources (LON:KMR), MirLand Development Corporation (LON:MLD), Prudential (LON:PRU), Servelec Group (LON:SERV), StatPro Group (LON:SOG). Interims: Brooks Macdonald Group (LON:BRK). Trading Statement: Kenmare Resources (LON:KMR).

The following widely held stocks are trading in ex-dividend form on Wednesday: Land Securities, Randgold Resources, Standard Chartered, HSBC, Direct Line, BATs, Domino’s Pizza, Hargreaves Lansdown, Hammerson

Economic: UK: Trade Balance. EU: French Final Non-Farm Payrolls, Industrial Production. US: 10-y Bond Auction, Federal Budget Balance.

Thursday

Companies: Finals: bwin.party digital entertainment (LON:BPTY), Costain Group (LON:COST), F&C Asset Management (LON:FCAM), Fairpoint Group (LON:FRP), Independent News & Media (LON:INM), Morrison (Wm) Supermarkets (LON:MRW), Nichols (LON:NICL), Plaza Centers NV (LON:PLAZ), Restore (LON:RST), SIG (LON:SHI), Salamander Energy (LON:SMDR), TT Electronics (LON:TTG). Trading Statement: Home Retail Group (LON:HOME), Northgate (LON:NTG).

Economic: UK: BOE Quarterly Bulletin, RICS House Price Balance, Inflation Report Hearings. EU: French CPI, ECB Monthly Bulletin. US: Retail Sales, Core Retail Sales, Unemployment Claims, Import Prices, Business Inventories, 30-y Bond Auction.

Friday

Companies: Finals: 4imprint Group (LON:FOUR), Tribal Group (LON:TRB). Interims: Wetherspoon (J D) (LON:JDW). Trading Statement: SThree (LON:STHR).

Economic: UK: CB Leading Index. EU: German Final CPI, Employment Change. US: PPI, Core PPI, Prelim UoM Consumer Sentiment, Prelim UoM Inflation Expectations.


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