Friday will see action on both the company news and macro data fronts, with results from housebuilder Berkeley and the latest US non-farm payroll (NFP) data likely to draw the most attention at the end of the week.
The NFP data may be greeted with some wariness by investors following the ADP jobs report on Wednesday, which showed the US private sector added 307,000 jobs in November, down from the revised figure of 404,000 in October and well below analyst estimates of 440,000.
The four-month low for job creation has been attributed to a surge in COVID-19 cases slamming the brakes on US hiring. If the slowdown is confirmed in Friday’s numbers it will likely raise concerns that the US employment outlook could be in for a rough winter.
Build up to Berkeley’s interims
Berkeley Group Holdings PLC (LON:BKG) is releasing its half-year results on Friday, where analysts at UBS expect revenue to decline by 6% to GBP872mln, with profit before tax of around GBP212mln from last year’s GBP278mln.
The figure is in line with recent guidance of splitting profits 40-60 across the two halves, meaning the full-year profit should come in at GBP500mln.
Interim operating margin is estimated to be 23.5%, down from 27.5% last year, while cash net should be over GBP1bn.
The market is also waiting to hear updates on recent trading conditions as well as on land acquisitions, considering the FTSE 100 company recently signalled it is progressing more opportunities.
Investors are looking to here whether the firm looks to revive its plan to return GBP455mln in cash to shareholders, which could return around GBP2bn to investors in cash and dividends by 2025.
“Berkeley’s shares are, at the time of recording, trading at their highest level since March, although they are still down by a fifth from their early 2020 peaks,” analysts at AJ Bell noted.
“That slide owes much to the pandemic and prevailing economic uncertainty, despite Government initiatives to support the house building industry, including the latest extension of the Help To Buy scheme and a holiday on stamp duty land tax on the first GBP500,000 on the purchase of a property until 31 March 2021.”
“However, September’s trading statement offered some grounds for encouragement and support to the share price recovery seen since the height of the market-wide panic in March.”
Significant announcements for Friday December 4:
Interims: Berkeley Group Holdings PLC (LON:BKG), Stenprop Limited (LON:STP)
Finals: SkinBioTherapeutics PLC (LON:SBTX)
Economic data: US non-farm payrolls, US unemployment, UK construction PMI