Big tech, banks and BAE Systems prepare to update the market

WHILE the corporate results calendar is quieter than last week, there are still a host of major updates to whet investors appetites.

One of the world’s largest arms manufacturers BAE Systems is set to issue its half year results on Wednesday. It was one of the best performing stocks in the FTSE 100 in 2022, as Russia’s invasion of Ukraine saw defence spending rocket. But the shares have been weaker in 2023, up 7.6 per cent year-to-date.

“Their modest gain leaves them ranked 37th at the time of writing, but they do trade within 10 per cent of their all-time high,” Laith Khalaf, head of investment analysis at AJ Bell, said.

“Since February’s full-year results for 2022, BAE Systems has said precious little, other than to reaffirm its full-year guidance for 2023 in May’s trading update.” Investors will be all ears.

Elsewhere, tech giant Amazon and Apple will issue their Q2 and Q3 results respectively. Amazon has previously warned that growth in its cloud computing business is cooling. but Michael Hewson, chief market analyst at CMC Markets, noted: “This warning about future growth doesn’t appear to have diminished enthusiasm for the shares, with the shares strongly higher since then.”

Finally, while HSBC will post its half year results tomorrow, high street bellwether

Next reports its Q2 results on Thursday. While Next has been one of the few retailers to buck the negativity surrounding the UK economy during the first half of this year, Q2 sales are expected to dip slightly. Analysts will look to see if it revises its sales guidance for the rest of the year ahead.

Polling supremo YouGov now expects full-year revenues to be at the lower end of the consensus range (£257m-£274m), news which has seen its shares tumble over 10 per cent. However, its ongoing focus on selling high-margin products and services has resulted in better-than-expected margins, while net cash is robust at £104m. Peel Hunt still says ‘buy’ with a target price of 1,360p per share.

WHEN DOVES CRY “A 14th interest rate rise in a row is expected on Thursday. The MPC looks a much more hawkish outfit now that Silvana Tenreyro has left. Swati Dhingra will prop up the dovish vote, but she now looks like the only one left on the ninestrong panel that prefers to lean on the side of caution. As a result, the Bank may yet meet market expectations of lifting rates to a peak of 5.75 per cent.”

JACK BARNETT, ECONOMICS EDITOR