The end of the week is looking like a quiet one in terms of company news, although trading updates from IT group Computacenter PLC (LON:CCC), retailer TheWorks.co.uk PLC (LON:WRKS) and a few others will give investors something chew over on Friday.
Instead, more attention is likely to be paid to the macro calendar as flash PMI readings for January are released for both the UK and the US.
Readings for the first month of 2021 are expected to be lower across the board, particularly in the UK and particularly for services.
“Manufacturing is forecast to remain in expansionary mode in all the countries, but services, which have been contracting except in the US, are expected to fall even more. Not good,” said Marshall Gittler at BDSwiss.
The UK’s decline in November GDP last Friday was not as bad as feared, but the UK economy is going to get worse before it gets better due to the current lockdown.
“A double-dip recession is increasingly on the cards for Britain,” says Robert Alster at Close Brothers Asset Management. “Virus cases continue to climb, leaving policy-makers grappling with establishing an effective health policy whilst providing enough financial support for both individuals and businesses. With no set end-date for the current restrictions, investors will be hoping that the rapid vaccine roll-out programme across the nation will get the UK economy up and running again, meaning there is light at the end of the tunnel.”
Significant announcements expected for Friday January 22:
Economic data: UK retail sales, UK consumer confidence, UK flash PMIs, US flash PMIs