Barclays PLC (LON:BARC) kicks off the latest earnings season for the lenders when investors will be looking for signs of improvement in its under-pressure investment bank.
The FTSE 100 company has been urged by activist investor Ed Bramson to shrink its investment bank and focus on retail banking.
Bramson, whose investment vehicle Sherborne owns a 5.4% stake in Barclays, has also called for chairman John McFarlane to step down.
It, therefore, goes without saying that Barclays will need to show it is on track to boost returns for shareholders when it reports its quarterly results.
UBS expects Barclays to report an adjusted pre-tax profit of £1.09bn for the quarter, compared to £1.19bn a year ago, on higher costs related to foreign exchange rates and investments. Total income is forecast to fall to £5.02bn from £5.17bn.
“If top-line misses in 3Q18 investors will want to see cost discipline, not investment plans (though we like the move to near shore in Glasgow and New Jersey),” UBS said.
Copper clouds for Antofagasta
Back in August, copper miner Antofagasta PLC (LON:ANTO) cautioned the market over the much publicised global trade tensions that had clouded the short-term copper demand outlook for large-scale miners.
At that time, Antofagasta reported a drop in first-half earnings and cut its dividend. The group saw its underlying earnings (EBITDA) fall by 16.2% to US$904.2mln for the first six months of 2018, down from US$1.079bn a year earlier.
Plainly, financial performance and the commodity outlook will remain important factors for investors but sentiment has improved in some quarters, with RBC Capital having recently upgraded its rating to ‘outperform’ from ‘sector perform’ largely on valuation grounds, as a response to a weakness in Antofagasta’s share price.
Significant announcements expected
Trading update: Barclays PLC (Q3) (LON:BARC), Antofagasta PLC (Q3) (LON:ANTO), Fresnillo PLC (LON:FRES), Cobham PLC (LON:COB), Serco PLC (LON:SRP), Metro Bank PLC (Q3) (LON:MTRO), Tatton Asset Management Plc (LON:TAM)
Finals: Image Scan Holdings Plc (LON:IGE)
Interims: Stobart Group Ltd (LON:STOB), U+I Group PLC (LON:UAI)
Economic data: UK trade in goods; US new home sales; Fed Beige Book