The FTSE 100 closed over 0.5% lower at 7,493.09 on Thursday (18 July) following a drab day of trading with poor export data from Singapore, a country seen as the barometer for global trade, stoking fears over the impact of US-China trade tensions.
The UK housing market will be in the spotlight next week as real estate portal Rightmove publishes its monthly house price index on Monday (22 July). The figures will come on the back of the latest survey from the Royal Institute of Chartered Surveyors, which showed that new buyer interest increased in the UK for the first time since November 2016. On Tuesday (23 July), investors will get an updated look at the state of Japan’s economy as the Bank of Japan releases its latest core consumer inflation data. Closer to home, the state of the high street banks will be in focus on Wednesday (24 July) when UK Finance releases its latest figures on mortgage lending, while on Friday (26 July) we’ll see whether Donald Trump’s bullish economic claims are true when the US publishes its quarter-on-quarter advance GDP figures.
Soft drinks have been in the limelight this week following very different results from two of the sector’s biggest manufacturers. Irn-Bru-to-Rubicon maker A.G. Barr (BAG) stunned the market on Tuesday after serving up a savage profit warning. Following poor weather last month and against a tough comparative with last summer’s heatwave, the soft drinks maker now expects sales for the 26 weeks to 27 July to be in the region of £123m, roughly a 10% year-on-year decline. And reflecting the impact of operational gearing, full year profits are expected to drop by up to 20%. As well as the weather, the company also blamed ‘brand specific challenges’ with its Rockstar energy drink and Rubicon juices, something which will be more concerning for investors than the unpredictable British weather. Nichols (NICL) on the other hand, known for its prized asset Vimto, this week reported a 2% increase in pre-tax profit to £13.3m for the six months to 30 June. Group revenue was up over 10% to £71.6m, with sales of different types of Vimto enjoying strong growth across the firm’s markets in the Middle East, Africa and the UK.
All eyes will be on the EU on Thursday (25 July) as the European Central Bank issues a statement on monetary policy, and gives its assessment of current economic conditions within the bloc as well as globally.
Schroder European (GB0007648123) offers investors exposure to larger companies listed in Europe, excluding the UK. Fund manager Martin Skanberg focuses on cheap stocks that have the ability to grow regardless of the prevailing market condition.
25 July - Half year results for miner Anglo American (AAL) are likely to show the benefits of a stronger iron ore price during the period. Although its Kumba iron ore mine saw production disrupted by plant maintenance, it has been ramping up output from the Minas-Rio iron ore mine this year. It will have also benefited from higher palladium prices, although the coal operations haven’t been as lucky with commodity prices falling.
25 July – First quarter results from consumer goods giant Unilever (ULVR) beat forecasts with underlying sales growth of 3.1% versus analysts’ expectations of 2.8%. New chief executive Alan Jope will be under pressure from investors at the forthcoming half year results to spell out plans for the company going forward, whether that means slimming down the business or making acquisitions to increase scale in certain product lines.
Narendra Modi and the BJP look set for victory in what has been a gargantuan undertaking for India and stock markets have surged to record highs on early results.
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