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Wednesday preview: Euro area inflation, Weir Group in the spotlight

By Alexander Bueso

Date: Tuesday 27 Feb 2018

LONDON (ShareCast) - (ShareCast News) - The focus on Wednesday will shift back towards this side of the Pond, with the latest euro area consumer price data for the month of February possibly vindicating European Central Bank chief Mario Draghi's caution when it comes to potentially premature shifts in the Governing Council's policy bias.
In particular, any such conclusion might make itself more felt in FX markets in the wake of new Fed chief Jerome Powell's confident take on the outlook for his country's economy during the previous session.

Against that backdrop, investors will also be watching out for GfK's latest reading on UK consumer confidence, also referencing February, and Lloyds's monthly business barometre.

In the company space, corporate updates were slated to keep coming in at a steady clip.

Among the firms scheduled to update markets on Wednesday was engineer Weir Group, which Numis analyst David Larkam forecast would post full-year profits before tax of 241m.

What should investors focus on?

"We see the most likely delta as being the margin progression in oil & gas with good drop through expected at this point in the recovery. Minerals will be watched closely after the Q3 update and given the comments from peers have been mixed (Metso for minerals to remain stable, Caterpillar for mining capex to improve)," said Larkam.

Regarding the company's Oil&Gas segment, Larkam explained that the company should now be in the 'sweet spot' "of recovering volumes before having to add costs".

"Numis view. Recent give back leaves the shares trading around 20x 2018 forecasts. Given the recovery potential in all three division this is starting to look interesting."

Wednesday February 28

INTERNATIONAL ECONOMIC ANNOUNCEMENTS

Chicago PMI (US) (14:45) Crude Oil Inventories (US) (15:30) GDP (Preliminary) (US) (13:30) GFK Consumer Confidence (GER) (07:00) Pending Homes Sales (US) (15:00) Unemployment Rate (GER) (07:00)

UK ECONOMIC ANNOUNCEMENTS

BRC Shop Price Index (00:01) GFK Consumer Confidence (00:01)

FINALS

Admiral Group, Bakkavor Group , Foxtons Group , Gocompare.com Group, Informa, ITV, Law Debenture Corp., Man Group, PPHE Hotel Group Ltd, Riverstone Energy Limited , Science Group , St James's Place, Tarsus Group, Taylor Wimpey, Travis Perkins, UBM, Weir Group

INTERIMS

Avingtrans, Genus, Ricardo

INTERIM DIVIDEND PAYMENT DATE

City of London Investment Trust 4.2% Non-Cum 2nd Prf Stk, Cohort, NB Private Equity Partners Ltd., PHSC

QUARTERLY PAYMENT DATE

City of London Inv Trust, Custodian Reit , Picton Property Income Ltd

SPECIAL DIVIDEND PAYMENT DATE

Cambian Group

EGMS

Amiad Water Systems Ltd

GMS

Booker Group, JPMorgan Income & Capital Inv Trust, Tesco

AGMS

Actual Experience , PCGH ZDP , Polar Capital Global Healthcare Trust, Sage Group

FINAL DIVIDEND PAYMENT DATE

Watkin Jones