There’s lots to bear in mind as BT Group PLC (LSE:BT.A) rings in with its annual results on Thursday, including the looming presence of French billionaire Patrick Drahi’s Altice on the shareholder register.
Trade unions are also threatening industrial action unless wages are increased by 10% and competition is hotting up for its Openreach arm
Shares in BT are slightly higher over the past 12 months, a rarity for shareholders in the former telecoms monopoly in recent years, and in contrast to the bumpy ride at Balfour Beatty plc (LSE:BBY), with the infrastructure contractor shedding a quarter of its value over the past 52 weeks.
Worries over rising costs, getting staff, supply chains are common themes currently, but with Balfour the worry is how much run for manoeuvre it has with its big civil engineering contracts.
Balfour should be able to mitigate inflation to some extent, says analyst Matt Britzman at Hargreaves Lansdown, as the value of both its UK and US portfolios are correlated with inflation and work to improve the order book means most contracts now see inflation borne by the client.
“The broader environment should also be supportive," he says, "With governments in key areas of the UK, US and Hong Kong all committing billions to infrastructure spending.
“Even so, we’ll be interested to hear commentary on how the wider market’s reacting to pressures.”
Macro news on Thursday includes UK’s snappily named 'short-term inductor day', with quarterly GDP, industrial and manufacturing production, and trade data, coming days after the Bank of England warned that a recession could be on the cards.
GDP grew a mere 0.1% in February, even though Russia didn’t begin its invasion of Ukraine until the latter days of the month.
While a 0.9% quarterly increase in GDP would be in line with the Bank of England’s estimate in the lasts policy review and so not have any implications for policy, analyst Marshall Gittler at BDSwiss said a deviation on the downside might "would only increase the concern of those members of the monetary policy committee who are worried about plunging the economy into recession.
"The market would probably react by removing even more tightening from the forecasts, which would be negative for GBP. A beat however wouldn’t prove anything at this point because the outlook is still grim. Thus I think we have an asymmetrical downside risk from the UK GDP figures.”
In the US, Disney will have some way to go to beat its forecast-busting numbers from the preceding quarter, which were driven by the strength of its Disney+ streaming offering.