This week the FTSE will go through its first review in the post-Brexit period, while ARM Holdings shareholders will vote on the lucrative offer from SoftBank, announced less than a month after the UK voted to leave the European Union.
Tuesday 30 August
- ARM Holdings shareholder meeting
Shareholders will vote to approve the acquisition of the Cambridge-based computer chip designer by Japan’s SoftBank. It has offered 1700p – a 43 per cent premium. The deal was 25 per cent cheaper in yen terms than it would have been a year ago due to sterling weakness in the aftermath of Brexit.
Wednesday 31 August
- FTSE UK Index Series Quarterly Review
- GfK UK Consumer Confidence – August
IHS Global Insights predicts consumer confidence improving from July, when it plunged following the initial shock of Brexit. “It is also very possible that confidence benefited in August from a feel good factor coming from the good weather and from Team GB’s strong performance in the Rio Olympics,” its chief UK and European economist Howard Archer says. However, in the coming months he predicts rising inflation and stagnant wage growth will take its toll.
- Chesnara (Q2 results)
Investment research analyst at The Share Centre, Ian Forrest, says the market will focus on the company’s Solvency II ratio and whether it’’s been impacted by Breixt.
“So far investors do not seem too concerned since the shares have risen above pre-Brexit levels.”
Pre-tax profits rose strongly during 2015, and Forrest says investors will be keeping an eye on whether this momentum continues.
- PPHE Hotel (interim results)
Thursday 1 September
- UK Manufacturing Purchasing Managers Index
The index tracking UK manufacturing fell to 48.2 in July, its lowest reading in over three years. This month’s data will reveal whether that was an initial shock reaction to the referendum result.
IHS Global Insights predicts that it will move to 49.8, representing flat activity. “We suspect manufacturing activity to have been helped in August by the recent substantial drop in the pound supporting a marked pick-up in export orders, thereby compensating for likely muted domestic demand.”
Friday 2 September
- UK Construction Purchasing Managers’ Index
IHS Global Insights predicts this to edge up to 46.5 in August after falling to 45.9 in July. Archer says Brexit could weight significantly on construction activity if clients are reluctant to commit to new projects, particularly in the commercial real estate sector.
Archer adds that construction companies will be keeping an eye on the Autumn Statement. “The construction sector will be hoping that the new government under Theresa May sees increased spending on infrastructure in as a way of boosting the economy in the face of Brexit uncertainties, and also magnifies its attempts to boost housebuilding.”
- US jobs report, August – US Bureau of Labor Statistics
Last month, US non-farm payrolls rose by an impressive 255,000, far exceeding expectations. In the last six months, 1.1m jobs have been added and if this trend continues it could lend support to a Fed rate hike.