AFTER Royal Bank of Scotland stole a lead on Friday by rushing out better-than-expected results, the pressure is on rivals Lloyds and Barclays to deliver this week.
Any underlying improvement at Lloyds looks set to be undermined by further adjustments for PPI and the rigging of Libor rates, while Barclays continues to be hamstrung by its declining investment arm.
With Scottish Gas owner Centrica also reporting, consumer issues are likely to be on the agenda, amid pressure from some quarters to cut prices.
In economic news, the US is to the fore as the Federal Reserve continues to taper its support package. Its statement will be scrutinised for signs that a rate rise is being mulled.
• Reckitt Benckiser – Fresh from announcing a £100 million investment in its UK research and development arm, the household products group is expected to put in another solid performance for the second quarter. Analysts will be more interested in any updates on plans to spin off or sell businesses.
• Household lending – Mortgage approvals have been slipping in recent months, but economists say the decline could come to an end after recent figures from the British Bankers’ Association showed a modest recovery in June.
• Barclays – interim results follow an eventful period which has seen the bank slash 7,000 posts at its investment arm. Analysts at Credit Suisse are forecasting group second–quarter group pre–tax profits to come in 2 per cent lower than last year, at £1.76 billion
• Greggs – The City is expecting a decent set of half–year figures as the turnaround at the pasty and sausage roll maker plan begins to take hold.
• Lloyds Banking Group – Analysts at Deutsche Bank expect half–year underlying profits to have firmed 20 per cent to £3.48bn as Lloyds benefits from strong UK growth, but a series of provisions including £500m set aside for PPI will hit the bottom line. Spin–off TSB reports on the same day.
• Centrica – The Scottish Gas owner is expected to reveal a sharp fall in half–year profits due to a combination of a mild winter in Britain and extreme weather hitting its business in America. It is also set to name a successor to chief executive Sam Laidlaw after admitting that it was in talks with BP’s Iain Conn.
• Manufacturing PMI – With the new month, a new set of purchasing managers’ surveys will give a heads up on the economy’s progress.
• International Airlines Group – Recent profit warnings from Lufthansa and Air France–KLM caused by competition from Middle Eastern carriers means IAG investors are awaiting its half–year figures with fingers crossed. Cost–cutting at Iberia may save the day.