Week ahead: Clothing and furniture sector slides
Morgan Stanley economists believe the consumer prices index (CPI) fell to minus 0.1 per cent in June on the back of lower clothing and furniture prices, but they predict the move will be temporary, with inflation creeping back into positive again this month and remaining “flattish” before starting to rise in the third quarter of the year.
However, Howard Archer, chief UK and European economist at IHS Global Insight, reckons June’s CPI will have held steady at 0.1 per cent amid “some firming of food prices and overall less discounting by retailers than a year ago”.
• Collagen Solutions – Annual results are scheduled from the Glasgow firm, which develops medical-grade collagen for use in regenerative medicine and medical devices. In January, the company struck a deal to supply US healthcare outfit Globus Medical with collagen powder for use in making bone-grafting products deployed in spinal surgery.
• Retail sales – The British Retail Consortium publishes its sales monitor for June, which is tipped to show healthy growth after official data from the Office for National Statistics (ONS) revealed volumes in May were 4.6 per cent higher than a year ago.
• Inflation – Official figures for June will be published by the ONS. Economists are divided as to whether the numbers will reveal CPI was steady at 0.1 per cent or fell back into deflation.
• Burberry – The fashion retailer, headed by chief executive Christopher Bailey, is expected to report slower trading in the wake of disappointing full–year figures in the spring. Brokers at Hargreaves Lansdown forecast that the firm, famous for its trenchcoats, will post sales for the first three months of the year up between 6 and 7 per cent, compared with 17 per cent in the same quarter year ago. The firm is expected to see its strongest performance in China.
• Dixons Carphone – The electrical goods and mobile phones retailer reports its first set of annual results since the merger of Currys and PC World parent Dixons Retail with Carphone Warehouse. In a trading update last month the group said it would post pre–tax profits just above previous guidance of £355m to £375m, and City analysts have pencilled in a figure of about £376m for the full year.
• Sports Direct – Annual results are also expected from the UK’s largest sportswear retailer. The company, controlled by Newcastle United owner Mike Ashley, has already said that underlying earnings would be in line with forecasts of £380m, which would trigger a multi–million-pound share payout in September under its staff bonus scheme.
• Michael Page – A second–quarter trading update is due from the recruitment outfit, which enjoyed an 11 per cent rise in sales during the first three months of the year.
• Infinis – The green power company, which has seen its shares hit by the Budget shake–up to climate change levy exemptions, holds its annual shareholder meeting.
• FirstGroup – John McFarlane retires as chairman of the Aberdeen–based bus and rail operator, having recently said he will take on the role of executive chairman at Barclays after Antony Jenkins was ousted as the lender’s boss.