Wednesday preview: UK CPÎ, Burberry in focus


The market spotlight on Wednesday will fall on consumer price inflation in the UK.

Consensus is for the Consumer Price Index to rise at a year-on-year rate of 9.0%, two full percentage points more than during the previous month on the back of a 54% rise in household energy bills.

In a research note sent to clients, economists at Barclays Research said that could mark the peak, but the Bank of England was expecting CPI to crest above 10.0% in the fourth quarter of 2022, not least due to a further jump in energy bills next October.

The difference between the two forecasts was due to the “more persistent” inflationary dynamics assumed by Bank, Barclays said.

And following the March employment report published the day before, for now at least the numbers appeared to be coming in on Bank’s side.

Indeed, following the employment report, Paul Dales, chief UK economist at Capital Economics, told clients: “This supports our view that the Bank of England will have to raise interest rates further than widely expected, from 1.00% now perhaps all the way to 3.00% next year.”

Consumer prices will also be in focus across the Channel with Eurostat set to release a final reading on inflation in April.

Economists had penciled-in a record annual CPI rate of 7.5%, up one tenth of a percentage point from March and in line with preliminary estimates.

Further afield, Japan was scheduled to release a reading on first quarter gross domestic product (Barclays: -0.1% quarter-on-quarter).

On the corporate side of things, Burberry is scheduled to publish its full-year numbers. Investors will be looking to see to what extent Covid-19 lockdowns kept the fashion firm from hitting its target for operating profits.

In late January, management guided towards approximately 35% growth in full-year operating profits at constant exchange rates.

It also reiterated medium-term guidance for high single-digit top line growth and meaningful margin accretion at CER.

Wednesday 18 May

INTERIMS

Benchmark Holdings , Marston’s, Marston’s, Mitchells & Butlers

INTERIM DIVIDEND PAYMENT DATE

Barratt Developments

INTERNATIONAL ECONOMIC ANNOUNCEMENTS

Building Permits (US) (13:30)

Crude Oil Inventories (US) (15:30)

Housing Starts (US) (13:30)

MBA Mortgage Applications (US) (12:00)

FINALS

Assura , British Land Company, Brown (N.) Group, Burberry Group, Experian, Ninety One

AGMS

Abrdn , Alliance Pharma, Burford Capital NPV (DI), Burford Capital NPV (DI), CVC Credit Partners European Opportunities Ltd GBP, Deltex Medical Group, EKF Diagnostics Holdings , Highcroft Investment, Impax Environmental Markets, Keller Group, Merchants Trust, PensionBee Group , PYX Resources Limited NPV (DI), Riverstone Credit Opportunities Income, Schroder UK Public Private Trust , Science Group , Seplat Energy (DI), TI Fluid Systems, Vesuvius, Vistry Group

UK ECONOMIC ANNOUNCEMENTS

Consumer Price Index (07:00)

Producer Price Index (07:00)

Retail Price Index (07:00)

FINAL DIVIDEND PAYMENT DATE

Eurocell , Genel Energy, Harbour Energy , Morgan Sindall Group, OSB Group , Rentokil Initial

Q1

TBC Bank Group