Week ahead: Good news on UK’s economic performance
Economists at Morgan Stanley said: “In fact, when the minutes are published on 17 June, we expect them to show that the vote was unanimous, as in all the meetings so far this year.”
In a busy week for economic data, the latest snapshot on the health of the manufacturing industry is tipped to show accelerating output, while the dominant services sector is forecast to register stable expansion.
The new boss of car parts chain Halfords is expected to announce a rise in profits.
• Manufacturing – The PMI reading for the sector is forecast to have risen to 52.5 for May, having fallen to a seven–month low of 51.9 the previous month.
• Construction – Activity among builders is expected to have improved modestly last month, following declines over recent months, although some clients delayed spending plans ahead of the general election.
• Amec Foster Wheeler – A trading update is scheduled from the oil and gas and mining engineer, created by the merger last year of London–listed Amec with Foster Wheeler, which was quoted on New York’s Nasdaq Stock Exchange.
• Services – Output from the powerhouse of the UK economy is tipped to remain on a stable upward trajectory, with a PMI reading of 59.5 for May, in line with April. Taken with the other PMI surveys, this would point to second–quarter economic growth improving to 0.8 per cent, up from 0.3 per cent in the first three months.
• Dixons Carphone – The newly created company behind Carphone Warehouse and Currys PC World is expected to post solid trading amid tough times on the high street. Analysts have pencilled in a 5 per cent rise in like–for–like sales when the retailer gives an update on the final four months of its financial year. The firm expects that profits for the year to June will be stronger than market forecasts of between £355 million and £375m.
• EasyHotel – Half–year results are due from the budget hotel operator, founded by Stelios Haji–Ioannou of EasyJet fame. The company floated on the Alternative Investment Market a year ago and has 20 hotels, including sites in Edinburgh and Glasgow.
• Interest rates – Any change from the record low of 0.5 per cent would come as a huge surprise, with Morgan Stanley economists believing there is “little justification for any near–term tightening of policy” from the Bank of England.
• Halfords – The car parts and bicycles chain’s new chief executive, Jill McDonald, unveils her first set of annual results and the City expects an 8.2 per cent rise in pre–tax profits to £78.8 million, driven by the nation’s renewed interest in cycling. The new boss, previously in charge of UK operations at fast–food chain McDonald’s, joined last month to replace Matt Davies, who left to become UK and Ireland chief executive at supermarket giant Tesco.
• Bellway – The housebuilder, which saw pre–tax profits surge by 53 per cent to £158.9m in the first half of the year, will update shareholders on recent trading. Chief executive Ted Ayres said in March that the firm was “well positioned to continue its disciplined strategy for growth”.