As the latest rock-bottom consumer confidence data shows it's a tough time for retailers, who will be a dominant presence in the coming week, including Kingfisher, M&S and Pets and Home.
Utilities, a popular choice with investors during times of market stress, might be in a happier place, with power company SSE along with water companies Severn Trent and United Utilities - though reports of a criminal probe into water pollution could make some uncomfortable.
Elsewhere food and holidays are also themes, with meat producers Cranswick and Hilton, along with beach tours specialist On The Beach and airport cafe operator SSP.
There are also the last macroeconomic nuggets of the month, with flash PMI surveys and a closely watched Federal Reserve update.
MONDAY 23 MAY
On Monday, Avon Protection PLC (LSE:AVON), the maker of military helmets and respirators, marches into the City from its Wilshire base with first-half numbers that follow a mixed trading update.
On the one hand, revenues were said to be on target, with a step-change in demand in the wake of the Ukraine war, but on the other, the high costs in the helmet business meant profitability had taken some flak.
“Whilst disappointing in the short term,” broker Peel Hunt said the demand backdrop “remains undeniably positive”, including discussions around new and incremental orders across respiratory and helmet products, as well as previously announced cost reductions.
TUESDAY 24 MAY
Meat packer Cranswick PLC (LSE:CWK)’s shares are down 13% over the past month after Aldi, Pret a Manger, Tesco and Sainsbury, Waitrose and other retailers recalled sandwiches and other food-to-go products containing chicken from the company due to concerns about salmonella contamination.
It was confirmed by the Food Standards Agency that a routine internal inspection identified the presence of salmonella in some cooked chicken products prepared at its poultry facility in Hull, with the FTSE 250-listed company liaising with agency and closing the factory until investigations are complete.
Besides what is expected to be a strong performance last year, investors will be interested in what management has to say about the investigation and the sharp increase in the cost of pigs and chickens over the past two months, alongside the cost of living crisis that is sure to hit demand.
One of Cranswick’s clients is Greencore Group PLC (LSE:GNC), which supplies a wide variety of prepared foods to the big supermarkets, including chicken sandwiches.
Sales from Greencore are expected to have improved in the second quarter and new business wins, with underlying profits of £15mln forecast compared to breakeven last year and £38mln in 2020.
The outlook will be important as sales will need to be strong to offset cost increases.
Hilton Foods is the third food company making a statement on the day, with some commentary usually provided ahead of its annual shareholder meeting.
“The company is very well placed in the current inflationary environment, given that the majority of business is on cost-plus contracts. The squeeze on consumer spend will have an impact on volumes, but the business has relatively low operational gearing,” said broker Peel Hunt.
Travel-related outfits SSP Group plc (LSE:SSPG) and On The Beach Group PLC will also be in focus and hoping to get a repeat of the warm reception given to the airlines that reported in the past week.
(Read more on the travel pair here.)
RS Group PLC, the former Electrocomponents, has issued three upgrades since January and so if it does not unveil an impressive set of results it will be a big surprise.
In macro world, preliminary ‘flash’ purchasing managers index (PMIs) surveys on Tuesday “will be front and centre for investors following the growth concerns that roiled markets this week”.
Markets will be closely watching for signs of a slowdown in the PMIs for the US, UK, Germany, France and Japan.
WEDNESDAY 25 MAY
Marks and Spencer Group PLC (LSE:MKS) and Pets at Home PLC are two out of the several retailers repoting during the week, following the mixed retail data the previous Friday and the record low for UK consumer confidence.
At M&S it’s also chief executive Steve Rowe’s last day, as he passes the baton to new joint-CEOs Steve Machin and Katie Bickerstaffe, who are expected to guide to lower profits for the year ahead.
(Read more in the retailer preview here.) https://www.proactiveinvestors.co.uk/companies/news/982851/consumer-confident-m-s-kingfisher-and-pets-at-home-will-give-retail-reading-on-household-squeeze-982851.html
Elsewhere, central banks will be a major focus for investors, with minutes from the US Federal Reserve’s latest FOMC meeting due on Wednesday.
Details about policy tightening, aka QT, and central bankers' thoughts on the path of future rates will be closely scrutinised.
THURSDAY 26 MAY
Water company United Utilities PLC is another company where the boss is stepping down, with Steve Mogford to be succeeded by customer service chief Louise Beardmore next year.
The industry has just heaved a sigh of relief, after the government rejected a recommendation by MPs that water companies should be required to measure the volume of raw sewage being dumped into rivers.
A report from parliament's environmental audit committee said: “Water companies appear to be dumping untreated or partially treated sewage in rivers on a regular basis, often breaching the terms of permits that on paper only allow them to do this in exceptional circumstances.”
But while Downing Street is letting it flow, a criminal regulatory investigation (https://environmentagency.blog.gov.uk/2022/05/12/update-on-environment-agency-investigation/) by regulators the Environment Agency (EA) and Ofwat of all 10 water companies’ treatment plants is examining whether they breached legal regulations about when and how frequently they are allowed to release raw sewage into waterways.
The investigations were launched after companies revealed they may be in breach of their permit conditions.
Expect plenty of hot air about improving their record on pollution from UU on Thursday and rival Severn Trent PLC (LSE:SVT) a day earlier.
Thursday is a utilities day, with SSE PLC (LSE:SSE) also reporting after a year where it has continued to invest in its renewables credentials but has benefitted from the government’s encouragement to keep its last coal-fired power station running.
Renewables are only responsible for around 7% of operating profits but with £12.5bn committed to expanding this arm over the next few years, including more than £2bn this year.
Output will be the figure to watch, said Laura Hoy at Hargreaves Lansdown, after worse than expected weather kept the division from living up to its potential, though just 12% below target rather than the 19% previously guided.
“Debt is another figure to watch and has been a bugbear for SSE for some time,” Hoy reckoned, with net debt roughly four times forecast cash profits.
FRIDAY 27 MAY
Renewi PLC (LSE:RWI), the waste-to-product business, said in March that trading in the year to the end of March had been ahead of previous expectations and performance for this year should also be ahead of market forecasts.
The company was also boasting of its ability to pass inflationary costs through to customers, so we’ll see if that is still the case now that the inflation demon is getting its groove on.
Traders will be looking stateside for US PCE inflation data on Friday, a key measure for the rate setters of the Federal Reserve along with wages and jobs data due a week later.
With US consumer price index dipping to 8.3% in April, down from a 41-year high the previous month, the personal consumption expenditure (PCE) index is the measure the Fed favours.
Economists expect the PCE to retreat slightly to 5.0% from 5.2% in March but prices are predicted to remain high for at least the rest of the year and markets are pricing a 93% chance of another half-percentage point hike in US interest rates to 1.5% in mid-June, with a two-thirds chance rates will be as high as 3% by Christmas.
Significant announcement on week 23-27 May
Monday 23 May
Finals: Big Yellow Group PLC (LSE:BYG), Creo Medical PLC, Kainos (LSE:KNOS) Group PLC
Interims: MTI Wireless Edge PLC
Trading announcements: CentralNic Group PLC, Kingfisher PLC (LSE:KGF)
AGMs: Arecor Therapeutics PLC (AIM:AREC), Belvoir Group PLC (AIM:BLV), Digital 9 Infrastructure PLC (LSE:DGI9), Empiric Student Property PLC, Hummingbird Resources PLC, TMT Investments (AIM:TMT) PLC
Tuesday 24 May
Finals: AVEVA Group PLC, Bytes Technology Group PLC (LSE:BYIT, JSE:BYI), Cordiant Digital Infrastructure Limited, Cranswick PLC, Helical (LSE:HLCL) PLC, Homeserve PLC (LSE:HSV), Likewise Group PLC (AIM:LIKE), Lords Group Trading PLC (AIM:LORD), RS Group PLC, Speedy Hire PLC (LSE:SDY)
Interims: Avon Protection PLC, Greencore Group PLC, OnTheBeach Group PLC, Residential Secure Income REIT, Shaftesbury PLC (LSE:SHB), SSP PLC, Topps Tiles PLC (LSE:TPT)
Trading announcements: Hill & Smith PLC
AGMs: 4imprint Group Plc (AQSE:FOUR), Afentra plc (AIM:AET), Artisanal Spirits Company PLC, Dunedin Income Growth Investment Trust PLC, Endeavour Mining PLC (LSE:EDV, TSX:EDV, OTCQX:EDVMF), Epwin Group PLC (LSE:EPW), FDM Group (LSE:FDM) PLC, Forterra PLC (LSE:FORT), Harworth Group PLC, Hill & Smith Holdings PLC (LSE:HILS), Hilton Food Group PLC (LSE:HFG), Horizonte Minerals PLC (AIM:HZM, TSX:HZM, OTC:HZMMF), JPMorgan American Investment Trust PLC, Judges Scientific PLC (AIM:JDG), M Winkworth Plc (AIM:WINK), Pebble Group PLC, Petershill Partners PLC (LSE:PHLL), Quarto Group (LSE:QRT) Inc, Restaurant Group PLC (LSE:RTN), Riverstone Energy Ltd (LSE:RSE), Shell PLC (LSE:SHEL, NYSE:SHEL), Thungela Resources Ltd, Vector Capital PLC (AIM:VCAP), WPP PLC (LSE:WPP)
Economic data: New Homes Sales (US), Public Sector Net Borrowing (UK)
Wednesday 25 May
Finals: Braemar Shipping Services PLC, De La Rue PLC (LSE:DLAR), HICL Infrastructure PLC, Likewise Group PLC, Marks & Spencer Group PLC, Mediclinic International Plc (LSE:MDC), Pennant International Group, Pets at Home Group PLC (LSE:PETS), Severn Trent PLC, SSE PLC
Interims: Hollywood Bowl Group PLC (LSE:BOWL)
Trading announcements: Intertek Group Plc (LSE:ITRK), Regional REIT (LSE:RGL) Ltd
AGMs: Access Intelligence PLC, Aston Martina Lagonda Global Holdings PLC, Bakkavor Group PLC (LSE:BAKK), Bodycote PLC, Eleco PLC, Fundsmith Emerging Equities Trust PLC, Hercules Site Services PLC (AIM:HERC), International Public Partnerships Limited, Intertek Group PLC, M&G PLC (LSE:MNG), Mortgage Advice Bureau Ltd, Regional REIT Ltd, RHI Magnesita NV, Sabre Insurance Group PLC (LSE:SBRE) ,Trustpilot Group PLC (LSE:TRST), Tullow Oil PLC (LSE:TLW), Zenova Group PLC (AIM:ZED), Zotefoams PLC (LSE:ZTF)
Economic data: MBA Mortgage Application (US), Durable Goods Orders (US), Crude Oil Inventories (US)
Thursday 26 May
Finals: Auto Trader Group PLC (LSE:AUTO), Caledonia Investments (LSE:CLDN) PLC, Edinburgh Investment Trust (LSE:EDIN) PLC, Facilities by ADF PLC (AIM:ADF), Intermediate Capital Group (LSE:ICP) PLC, Johnson Matthey PLC (LSE:JMAT), LondonMetric Property PLC (LSE:LMP), United Utilities Group PLC (LSE:UU.)
Interims: Abrdn Latin American Income Fund Ltd, AJ Bell PLC (LSE:AJB)
Trading announcements: Integrafin Holdings PLC, Wickes PLC
Ex-dividends to reduce the FTSE 100 by 2.18 points: Intertek Group, Whitbread, Sage Group, Imperial Brands, DCC
AGMs: Albion Technology & General VCT PLC, Aminex PLC (LSE:AEX), Bank of Ireland (LSE:BKIR) (Governor & CO), Bank of Ireland Group PLC, Belvoir Group PLC, BMO Private Equity Trust PLC, Boot (Henry) PLC, Central Asia Metals, Curtis Banks Group PLC (AIM:CBP), Diaceutics PLC (AIM:DXRX), East Star Resources Plc (LSE:EST), Energean PLC (LSE:ENOG), Ferrexpo PLC (LSE:FXPO), Hochschild Mining PLC (LSE:HOC, OTCQX:HCHDF), Jersey Oil & Gas PLC, Kenmare Resources plc (LSE:KMR), LBG Media Ltd, Legal & General Group PLC (LSE:LGEN), Mobeus Income & Growth VCT PLC (LSE:MIX), National World PLC (LSE:NWOR), Non-Standard Finance PLC (LSE:NSF), Petrofac PLC, Prudential PLC (LSE:PRU), Robinson PLC (AIM:RBN), S&U PLC, Sherborne Investors, Staffline Group PLC (AIM:STAF), hilStrix Group PLC, Wickes Group PLC (LSE:WIX), YU Group PLC, Zinc Media (AIM:ZIN) Crop PLC
Economic data: Continuing Claims (US), GDP (Preliminary) (US), Initial Jobless Claims (US), Pending Home Sales (US)
Friday 27 May
Finals: Renewi PLC, Volvere (AIM:VLE) PLC
AGMs: Barr A.G, Big Technologies PLC (AIM:BIG), BMO Commercial Property Trust Ltd, DeepMatter Group PLC (AIM:DMTR), Destiny Pharma Holdings PLC, Hostmore PLC (LSE:MORE), LSL Property Services PLC, Old Mutual Limited (LSE:OMU), Oxford Biomedica PLC, Spectris PLC (LSE:SXS), The Renewables Infrastructure Group Limited (LSE:TRIG), Triple Point Social Housing Reit PLC (LSE:SOHO)
Economic data: Personal Consumption Expenditure (US), Personal Income (US), Personal Spending (US), U. of Michigan Confidence (US)
US earnings season
Monday- Zoom Video Conferencing (Quarterly)
Tuesday- AutoZone, HPE, BestBuy, Ralph Lauren (Quarterly)
Wednesday- NVIDIA, Pinduoduo, Snowflake, Splunk, HP (Quarterly)
Thursday- CostCo, Medtronic, Marvell, Dollar General, VMWare, Hormel (Quarterly)