LONDON (ShareCast) - (ShareCast News) - US economic data is set to dominate Friday's agenda with the release of retail sales figures and the University of Michigan's consumer confidence survey in focus.
Economists expect the Commerce Department's US retail sales rose 0.7% in December following a 0.1% increase in November. The data is a key gauge of consumer spending which accounts for more than two-thirds of economic activity.

The University of Michigan's consumer confidence index is forecast to rise to 98.5 in January from 98.2 in December.

US business inventories data from the Commerce Department is expected to reveal a 0.5% rise in November following a 0.2% drop the previous month.

Elsewhere, China publishes its trade data for December, which is expected to show exports in dollar terms fell an annualised 3.8% and imports rose 3.0%. The trade balance is forecast to rise to $47.55bn in December from $44.61bn the prior month.

There is no UK economic data due. On the corporate calendar the only notable releases in the UK will be trading statements from Grafton and SIG.

On building materials compnay Grafton, Numis said it expects the full year divisional profile to be similar to that of the third quarter with the UK reporting broadly flat like-for-like sales in the four months to October, up 1.2%, but strong in the Ireland business with 11.4% growth in merchanting and 4% growth in retail. It also sees the Dutch businesses performing strongly in the first year of ownership.

"Investor focus will be on ability to pass on imported FX costs through rising prices and any statement about the price competitive nature of the UK market, though we believe it is too early to be able to indicate how much product prices are rising even though we believe there is a general and genuine desire to ensure gross margins are unaffected across the general merchant space," Numis said.

"Overall we expect estimates to be unchanged, and while the outlook will be uncertain going into 2017, Grafton has more levers than most in terms of growth capability both in the UK and overseas activities, hence it remaining our favoured stock in the general merchanting space."

The broker also commented on SIG, which issued a profit warning in November. Numis believes the warning from the supplier of insulation, roofing and construction products was "solely UK related and in our view more of a reflection of competitive price warring than a lurch down in activity". However, investors focus will likely be on how the situation has changed since then.

"Like-for-likes in the three months to October showed UK -1.1% and Europe +2.7% and the wider outlook will also be of interest, but the 150bps gross margin decline in the UK in H2 will be the focal point," Numis said.

"We believe that the replacement for the CEO will unlikely to have been resolved by time of the trading statement. Overall, we remain concerned about downside risks notably as the H2 UK run-rate needs to see considerable improvement foe SIG to be able to produce flat earnings in 2017E in line with our current estimate."



Friday 13 January

INTERIM DIVIDEND PAYMENT DATE
Acal, Brown (N.) Group, Cropper (James), Marks & Spencer Group, Polar Capital Holdings, Severfield, Tarsus Group

QUARTERLY PAYMENT DATE
Schlumberger Ltd.

INTERNATIONAL ECONOMIC ANNOUNCEMENTS
Business Inventories (US) (15:00)
Producer Price Index (US) (13:30)
Retail Sales (US) (13:30)
U. of Michigan Confidence (Prelim) (US) (15:00)

AGMS
Catalyst Media Group, Funding Circle SME Income Fund

TRADING ANNOUNCEMENTS
SIG, XP Power Ltd. (DI)

FINAL DIVIDEND PAYMENT DATE
Associated British Foods, Carr's Group, K3 Business Technology Group, TP ICAP

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