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Sheridan Admans, investment research manager at The Share Centre, gives his thoughts on what to expect from companies announcing results w/c 7 January 2013.

Monday – Morrisons (trading update) – HOLD

Wednesday – Sainsbury’s (Q3 results) – HOLD

The market rally on the first day of trading for the New Year didn’t bode well for Morrisons and Sainsburys with their share price slipping when the FTSE was trading above 6000, up around 2.3% on the day. Investors will be keen to get an update on the Christmas trading figures, as they are expected to disappoint.

Any further details on the speculation that Sainsbury’s CEO Justin King is likely to step down in 2014 and make way for Mike Coupe, its commercial director, will also be of interest.

Morrison is expected to suffer from poor Christmas trading as it is assumed shoppers traded down to discounters, such as Asda, Lidl and Aldi, which operate in many of the same locations Morrison occupy.

Economic Diary

10 January, Monetary Policy Committee Meeting and Announcement – Bank of England

In the most recent minutes from the Bank of England MPC, it emerged that the rate setting committee is concerned about the strength of sterling, and believes the UK needs a cheaper pound in order to give exporters a terms of trade advantage. However, while there is a good chance that 2013 will see more QE, only one member of the MPC, David Miles, voted to increase asset purchases by the Bank of England last month. It is not likely that the committee will see enough members change their minds for it to vote for more QE in January.

11 January, Index of Production, November 2012 – ONS

Data on industrial production gives a clue to growth in the UK’s GDP. In October, industrial production saw a 0.8 per cent month on month contraction, while manufacturing contracted by 1.3 per cent. If today’s data indicates that November also saw contraction, that will be evidence to suggest the UK’s GDP contracted in the final quarter of 2012.

Other economic announcements include:

8 January

• EU Retail trade, November – Eurostat
• Unemployment, November – Eurostat
• Economic Review, December 2012 – Eurostat

9 January

• EU National accounts (3rd estimate GDP), Q3 2012 – Eurostat
• Profitability of UK Companies , Q3 2012 – ONS
• UK Trade , November 2012 – ONS

10 January

• Governing Council meeting of the ECB in Frankfurt – ECB