Friday preview: US ISM, TalkTalk in the spotlight

updated: 31 January 2019 at 3:05pm Author: Alexander Bueso

(Sharecast News) - The market spotlight on Thursday will fall on the monthly US non-farm payrolls report, which is expected to show 163,000 new hires for the month of January.
That would be a far cry from the prior month's outsized increase of 312,000, yet nevertheless enough to continue pushing the US unemployment rate lower.

Investors are also expectant ahead of release of manufacturing sector surveys in China, the US and the UK referencing the month of January.

The US ISM manufacturing sector Purchasing Managers' Index in particular might make for interesting reading.

On 28 January, analysts at Morgan Stanley termed it "critical".

"Our US economics team expects a further fall in manufacturing PMI to 51.7. This print, which is still within the 50-55 range, would put us in a Goldilocks scenario for equities, while credit underperforms and bond yields fall," they told clients in a research note.

"We don't think that markets are priced for another huge downside surprise in PMI, with risks skewed unfavourably to the downside. Another sharp fall in PMI (below 50) would signal a new transition and challenge the recent risk rally."



On the corporate side of things and for the company's third quarter, Numis analyst John Karidis expected TalkTalk to report a 2.3% year-on-year decline in average revenues per user, after a fall of 2.9% during the preceding quarter.

That meant that improving net adds and churn were "worth less", he said.

Total headline revenue growth ex carrier and off-net was pegged at up by 3.5% on the year, versus the 3.7% seen over the prior three-month stretch.

In particular, Karidis was looking for TalkTalk to confirm an earlier forecast for full fiscal year EBITDA in line with consensus (£261m).

He also wanted management to reconfirm its forecast for net debt/EBITDA of roughly 2.7 by year-end.



For his part, UBS's Polo Tang said he was expecting "slight" revenue growth in the company's third quarter thanks to "solid" net adds, with fiscal year guidance for over 150,000 new subscribers expected to have already been met.

The company's average revenue per user was also expected to have stabilised.

Net debt meanwhile was seen at 3.2 times' the company's operating profits for the preceding 12 months.

Friday February 01

INTERIM DIVIDEND PAYMENT DATE

Aveva Group, Burberry Group, KCOM Group, United Utilities Group, Vodafone Group

QUARTERLY PAYMENT DATE

BMO UK High Income Trust , Mercantile Investment Trust (The)

INTERNATIONAL ECONOMIC ANNOUNCEMENTS

Auto Sales (US) (20:30)

Construction Spending (US) (15:00)

ISM Manufacturing (US) (15:00)

ISM Prices Paid (US) (15:00)

Non-Farm Payrolls (US) (13:30)

PMI Manufacturing (EU) (09:00)

PMI Manufacturing (US) (14:45)

Unemployment Rate (US) (13:30)

SPECIAL DIVIDEND PAYMENT DATE

BMO UK High Income Trust B Shares

AGMS

Brewin Dolphin Holdings, Catenae Innovation, Dukemount Capital, Euromoney Institutional Investor

UK ECONOMIC ANNOUNCEMENTS

Consumer Credit (09:30)

Mortgage Approvals (09:30)

PMI Manufacturing (09:30)

FINAL DIVIDEND PAYMENT DATE

BBA Aviation 5% Cum Prf, McCarthy & Stone, Schroder UK Mid Cap Fund, Unicorn AIM VCT