23.05.16 Monday Morning

If last week was all about inflation (and the rate-hike chatter that followed the US figure) then this week GDP rules the roost, with both the UK and US flinging their first quarter second estimates into the mix.

UK
At points grazing a fresh 2 month nadir it was a rocky week for the FTSE, an oil-inspired surge followed by limp inflation, a mixed jobs report and the market-wide fear of a potential US rate hike. There were also big movements for the pound, which sporadically soared as more and more polls gave Vote Remain the lead ahead of next month’s EU referendum

This week is fairly quiet for the UK index, with large patches on the economic calendar rather empty. Yet those few bits of data set to be released carry some real weight. Tuesday sees the latest public sector net borrowing number, before Thursday brings the big daddy, the second estimate Q1 GDP reading. Slipping from 0.6% in the fourth quarter of 2015 to 0.4% for the first quarter of this year the FTSE will be looking for an upwards revision; given the state of the UK’s recent data, however, the index may be left wanting.

Earnings wise there are a couple of notable releases as the week goes on. B&Q-owner Kingfisher reveals its first quarter update on Tuesday, as does Card Factory. Wednesday brings the week’s biggest statement, as a newly reshuffled Marks & Spencer posts its full year results, whilst Thursday then sees updates from Daily Mail & General Trust, Pets at Home and Tate & Lyle.

US
With a week just a wobbly as the FTSE’s the Dow Jones cleared its own 2 month lows, suffering as a strong inflation figure, and a surprisingly hawkish set of Fed meeting minutes from last month, pushed the index as low as 17330.

Like the UK index the Dow’s focus will firmly be on the end of this week, with the USA’s own Q1 GDP second estimate. The first reading came in at a truly woeful, and effectively stagnant, 0.5% in the annualised format (something that undermines those clamoured for a rate-hike), so there is plenty of room for a potential upwards revision come Friday. Elsewhere the US sees its flash manufacturing and services PMIs on Monday and Wednesday respectively, with the durable goods orders and weekly jobless claims on Thursday.

As this earnings season begins to wind down the US only really has a few big names left to report. Tiffany & Co will be hoping for a diamond Q1 report on Wednesday, as will Calvin Klein-owner PVH, whilst Thursday sees Abercrombie & Fitch and GameStop bust out their first quarter figures.

Eurozone
Like its global peers the Eurozone indices had a choppy week, despite an absence of key data, the DAX spending most of it dancing around the 10000 mark. This week gives the region’s investors a bit more to chew on. Monday sees the German, French and Eurozone wide flash manufacturing and services PMIs, alongside the latest consumer confidence figures, whilst the ZEW economic sentiment numbers arrive on Tuesday. Wednesday then sees business and consumer climate data from Germany, before the country releases its latest import prices on Thursday.

Stock of the week: Cranswick PLC – Full Year 2015 Earnings Release
So far 2016 has been a rather tasty year for food producer Cranswick. Can its rise and rise continue following its full year figures on Tuesday?

The company’s fourth quarter trading statement on the 4th April then gave the stock another nudge in the right direction, as Cranswick posted a 12% rise in total sales volumes for the 12 months ending 31st March. The pork producer’s April awesomeness didn’t end there. Soon after its Q4 report Cranswick received a 16% boost (briefly crossing £26 for the first time in the process) as it revealed it had bought Crown Chicken for £40 million in a bold move into the poultry market.

In terms of its annual figures next week Cranswick will be looking to build on the £1 billion in revenue in managed last year, whilst any increase on the £52.8 million it saw in pre-tax profits will likely have investors as happy as pigs in, well, you get the picture.