Leading shares look set to start fairly unchanged from yesterday's closing levels in early trade this morning, with a positive bias from a modest late rally overnight on Wall Street countered by uncertainty ahead of a big batch of UK corporate news, most notably interims from under-pressure retailer Marks & Spencer, dealers said.
Spread betting firm IG Index expects the FTSE 100 index to open flat today, with the UK blue chip index closing 23.2 points lower yesterday at 4,716.6.
Overnight on Wall Street, the DJIA closed 3.77 points higher at 10,391.31, while the Nasdaq composite index ended with a 0.31 point gain at 2,039.25.
Although both key US indices managed late rallies, trading overall was cautious as investors digested last week's big post-election gains and turned their attention to tomorrow's FOMC meeting.
In Asia today, the Nikkei 225 index ended its morning session 18.96 points lower at 10,964.87 in cautious trade ahead of the FOMC, while at midday the Hang Seng was 33.06 points easier at 13,528.43.
Corporate news should provide the early direction in London this morning, with the main focus likely to be interims from under-pressure blue chip retailer Marks & Spencer.
M&S shares have taken a knock over the past week amid investors' fear the struggling retail giant may have to admit to dire October sales with the figures -- although the firm does not normally issue a current trading update with its results statements.
The other area of investor focus will be on an update from M&S chief executive Stuart Rose on the recovery strategy he outlined in July as part of the group's defence against Philip Green's 9.1 bln stg takeover proposal.
The interim numbers themselves should not surprise. M&S has already flagged it will report a profit before tax and exceptional items of 285-295 mln stg for the 26 weeks to Oct 2, compared with a restated 325 mln stg last time out.
The day's other blue chip numbers come from directories group Yell, with the second quarter figures expected to confirm the group is on track to meet full year forecasts.
Deutsche Bank is looking for Yell to report pro forma second quarter pretax profit of 80.9 mln stg, up from 71.3 mln in the first quarter.
Yell said three months ago it was on track to meet expectations, although it noted that first half revenue growth in UK printed directories would be below that seen in its first quarter.
On the second line, second quarter results from Marconi Corp are unlikely to spring any surprises as the UK telecoms equipment group published a detailed, and very poorly received, trading update just three weeks ago.
In mid-October, Marconi warned that operating profit margins came to just 33 pct in the second-quarter, one point lower than expected, due to a deterioration in its business mix during the second quarter.
Consensus is for Marconi Corp to report second quarter adjusted operating profit on continuing operation of between 2-3 mln stg.
Meanwhile today's interims from Electrocomponents, also well-flagged in a recent trading update, are expected to be overshadowed by any comments the UK electronic parts distributor makes on future trading.
In its trading statement, published in late September, Electrocomponents said pretax profits for the six months to the end of September would be 51 mln stg, a 13 pct improvement on last year's 45.3 mln.
Among the small cap results, further progress is anticipated at engineer Chamberlin & Hill at the half year stage, with Arbuthnot Securities expecting the group to see a pick-up in profits as the synergistic benefits of recent acquisitions come on board.
Arbuthnot is forecasting Chamberlain & Hill to post first half pretax profits of 700,000 stg, up from 600,000 stg at the same stage last year.
Meanwhile software group Kewill Systems' interim numbers are expected to be boosted by acquisitions in the US.
Arbuthnot expects Kewill's first half pretax profit to double to 1.0 mln stg, up from 500,000 stg in the comparative period.
Interim results are also due today from the likes of Babcock International, Big Yellow Group, Dicom Group, and Marchpole, with Ferraris Group set to post full year numbers.
Among the day's AGMs, comments from blue chip Smiths Group's annual meeting should attract the most attention, while small caps Caffe Nero and Murchison also host AGMs.
On the macro front, all eyes will remain trained on tomorrow's FOMC meeting, with the Federal Reserve expected to nudge interest rates 25 basis points higher to 2 pct following recent improving US data.
However today's US pointer -- September Wholesale trade figures -- is unlikely to excite.
In domestic economic news, UK September trade figures will be a focus, with the global trade deficit seen narrowing slightly to 5.0 bln stg, after a 5.22 bln gap in August, and the non-EU trade gap to 2.9 bln stg from 2.98.
Traders will also be anxious to hear Chancellor Gordon Brown's keynote speech to the CBI conference today.

MARKS & SPENCER SAYS TRADING 'MORE DIFFICULT' SINCE OCT 12

BREAKING NEWS

* Mandelson comes out fighting on state aid; Brussels urged to halt protection of national industries - FT

* Private sector set for extra 1 bln stg boost from NHS - FT

* BRITISH AIRWAYS attacks US bankruptcy procedures, widely used by the American airline industry, as being another form of state aid - FT

* Shares in JARVIS plummet 60 pct as a warning of further losses and financial setbacks raises fresh concerns about the future of the support services group - FT

* DIAGEO and Pernod Ricard strenuously deny a claim by the Columbian government that they are embroiled in the contraband liquor market - FT

* BT buys Infonet for 965 mln usd

* Kohlberg Kravis Roberts understood to be among the private equity suitors for COX INSURANCE, the motor insurer that confirmed bid interest at the weekend

- FT

* RAYMARINE, the supplier of fish finders and navigation equipment to leisure boaters, plans to seek a listing on the main market in an initial public offering that could value it at close to 125 mln stg - FT

* CARPHONE WAREHOUSE has the worst overall customer satisfaction record among all the leading mobile phone retailers, according to a new survey by JD Power and Associates - Independent

* J SAINSBURY faces further distribution woes next week as EXCEL, which runs the supermarket's East Kilbride distribution centre, holds crisis talks to avoid a strike - Times

* Financial Times considering closing its weekly media supplement, Creative Business, in a 7 mln stg cost-cutting drive - Guardian



PRESS COMMENT

FT

THE LEX COLUMN comments on BRITISH AIRWAYS (for BA's charms as a geared cyclical play to emerge, higher traffic volumes need to be accompanied by pricing power), BT/Infonet (financially, the deal stacks up nicely, given the scope for cost reductions), News Corp, Chinese currency - IMPERIAL TOBACCO (hard to see where share price upside will come from until the buy-back programme gets under way)

Mail

BIOFUELS CORPORATION (a ceremony takes place today to mark the start of work at its 250,000-ton-output complex Seal Sands)

Express

WHO'S DEALING: INTERTEK (chairman sells 50,000 shares at 678-1/2 pence each) - SHARE WHISPER: WINCANTON (expected to make a bid for CHRISTIAN SALVESEN once its interim results are out of the way on Thursday) - BROKER'S VIEW: KINGFISHER (Merrill Lynch cuts estimates)

Independent

THE INVESTMENT COLUMN: FKI (worth holding), CARR'S MILLING (avoid), VTR (buy)

Times

RUMOUR OF THE DAY: WORLD TELEVISION (word it has won a contract to televise The Greatest Race on Earth, the inaugural four-marathon event sponsored by Standard Chartered, the bank) - DIRECTORS' DEALINGS: INTERTEK (directors sell stock) - IMPERIAL TOBACCO (sell), DCC (avoid), COX INSURANCE (worth holding in the expectation that a bid materialises)

Guardian

SAGE (Microsoft competition threat) - COURTS (rumours that some of its leather suppliers have stopped doing business with the company because they could no longer obtain credit insurance)

Telegraph

QUESTOR: IMPERIAL TOBACCO (nothing wrong with smoking out a bit of profit, if you've made it), FKI remain a good recovery play), UNIQ (with the company still looking ripe for a takeover, it could be a good idea to hang on a little longer)

Morning all.

Just a reminder that the webcast is about to start at 11am

Ian

Afternoon all