Wood Group (John) PLC is the biggest fish on the City menu for Tuesday.
The FTSE 250-listed group has been trying to reinvent itself by buffering up its green credentials but like its fossil fuel customers, its fortunes are still seemingly tied to the oil and gas cycle.
Its latest update guided to lower underlying profit for the first half of the year but a stronger performance in the second half, helped by an improved performance in Turbines joint ventures and stronger revenue growth in the Projects arm
Investors and analysts will be keen to hear any new ideas from new chief executive Ken Gilmartin, who started last month.
Earnings from further afield include one of Tesla’s Chinese rivals, XPeng Inc; Sage Group’s US rival Intuit, department store chain Nordstrom and clothing retailer Urban Outfitters.
In the first big macroeconomic data of the week on Tuesday there will be ‘flash’ purchasing managers’ index surveys released for the services and manufacturing sectors for the UK US and other major economies, along with a composite reading that can sometimes raise an early red flag for later official data.
A month ago, the US and eurozone composite PMIs slipped below the 50 mark, which indicating contraction territory.
For July, the UK services PMI came in at 52.6 but is expected to weaken to 52.0 for August, with the manufacturing PMI also seen softening from 52.1 in July to 51.2.
This would give a composite PMI of around 51.0, which being above 50 indicates the economy is still in expansion mode.
But economist Ruth Gregory at Capital Economics is one who thinks the composite PMI will have fallen below the 50 mark in August, which would be the first time since the last COVID-19 lockdown.
This is consistent with the economic forecasting group’s view that the economy will slip into recession this quarter.
Spending on travel and leisure services was reported to have supported activity in July, but Gregory said the squeeze on household real incomes from surging inflation is likely to mean this resilience will have proved short-lived.
She also said she “wouldn’t be surprised” that the PMI price balances could bring further signs that pipeline price pressures are easing.
“Even so, the recent surge in wholesale gas prices will soon filter through into higher energy costs for businesses, and the current tightness in the labour market means we think wage pressures will remain intense. That’s why we think the prices balances will probably remain at historically high levels for a while yet.”
The US PMIs will also be closely watched, said market analyst Marshall Gittler at BDSwiss, after the past week’s disastrous Empire State manufacturing survey, which “sent recession jitters down the market’s collective back”, though the Philadelphia Fed’s version of this index surprised on the upside.
Significant announcements on Tuesday
Interims: Aferian PLC (AIM:AFRN), RM Plc (LSE:RM.), John Wood Group PLC
AGMs: African Pioneer PLC (LSE:AFP), Bezant Resources PLC (AIM:BZT), Edge Performance VTC PLC, Kendrick Resources PLC (LSE:KEN), Livermore Investments Group Ltd, Xtract Resources PLC (LSE:XTR)
Economic announcements: Flash PMIs (UK, US), New Homes Sales (US)
US/China earnings: Intuit, JD.com, Medtronic, Nordstrom, Urban Outfitters, XPeng