Thursday preview: Bank of England, BT Group in the spotlight
By Alexander Bueso
Date: Wednesday 03 Feb 2021
(Sharecast News) - All eyes will be on the Bank of England on Thursday as it tackles the question of whether or not taking Bank Rate into negative territory is an option that should and can be implemented.
Bank is expected to publish the results of a consultation on the matter.
While at least some respondents are expected to express their dislike of the idea, rate-setters are expected to keep the option on table, perhaps even if only to avoid the risk that market interest rates might otherwise rise in response.
Stateside meanwhile, markets' attention will be on the latest weekly unemployment claims data.
Worth noting, the Department of Labor's monthly non-farm payrolls figures are scheduled to be published the next day.
On the Continent, the European Central Bank is set to release its monthly economic bulletin at 0900 GMT.
On the corporate side of things and ahead of BT Group's third quarter update, UBS analyst Polo Tang cautioned clients about the multiple hurdles the telecommunications group was facing for over the next six months.
Those included an expensive 5G spectrum auction, increased competition from Virgin Media, including from working more closely with Sky.
Furthermore, the £10.9bn pension deficit could constrain the company's dividends and limit mergers and acquisitions activity for BT.
For the third quarter meanwhile, the analysts expected still weak revenues due to its lack of mobile roaming during the pandemic and lower sports revenues linked to the same - although the worst of the headwinds from Covid-19 were now in the rearview mirror.
Tang was expecting BT to reiterate its full-year guidance for earnings before interest, taxes, depreciation and amortisation of £7.3-7.5bn and free cash flow from equity of £1.2-1.5bn.
Nonetheless, in his opinion the firm was only trading in-line with the sector while its shares were "expensive", trading on an EFCF yield of 4% against 10% for its peers.
Thursday 04 February
INTERIMS
Alumasc Group, Barratt Developments, NCC Group, Renishaw
INTERIM DIVIDEND PAYMENT DATE
Cohort, Johnson Matthey, XPS Pensions Group
INTERIM EX-DIVIDEND DATE
British Smaller Companies VCT 2, Downing One VCT , Marwyn Value Investors Limited, TI Fluid Systems
QUARTERLY EX-DIVIDEND DATE
Greencoat Renewables, Merchants Trust, Picton Property Income Ltd
INTERNATIONAL ECONOMIC ANNOUNCEMENTS
Continuing Claims (US) (13:30)
Factory Orders (US) (15:00)
Initial Jobless Claims (US) (13:30)
Retail Sales (EU) (10:00)
Q3
BT Group
Q4
Nokia OYJ, Nokia OYJ, OMV Petrom S.A. GDR (REG S), Public Joint Stock Company Severstal GDR (Reg S), Royal Dutch Shell 'A', Royal Dutch Shell 'A', Royal Dutch Shell 'B', Unilever
GMS
Hostelworld Group , Microsaic Systems
FINALS
Nokia OYJ, Nokia OYJ, OMV Petrom S.A. GDR (REG S), Royal Dutch Shell 'A', Royal Dutch Shell 'B', Unilever
EGMS
DCC, Yew Grove Reit
AGMS
Compass Group, Hargreave Hale AIM VCT , Sage Group, Stock Spirits Group , Ten Lifestyle Group , Unicorn AIM VCT , Unicorn AIM VCT
TRADING ANNOUNCEMENTS
Compass Group, Cranswick, Watches of Switzerland Group
UK ECONOMIC ANNOUNCEMENTS
BoE Interest Rate Decision (12:00)
PMI Construction (09:30)
FINAL EX-DIVIDEND DATE
Baronsmead Second Venture Trust, Baronsmead Venture Trust, Gulf Investment Fund, JPMorgan Russian Securities, Titon Holdings, Treatt
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