A Brief Look At The Week Ahead

The Chancellor's pre-Budget statement will dominate this week. There is a sense of the inevitable about Gordon Brown's savage downgrade of 2005 economic assumptions. The Chancellor has admitted his 3% to 3.5% 2005 GDP growth forecast is no longer viable. Economists are predicting a revised growth rate of around 2%. A slump in GDP growth may see windfall taxes brought forward in areas such as oil, property sales and banking. The Bank of England's Monetary Policy Committee deliberations on interest rates this week are widely anticipated to result in a decision to leave well alone. In corporate news this week, pub owner Greene King is expected on Tuesday to produce a strong interim pre-tax profit of 52m, an 18% increase on last year. Like its peers, Greene King has hit the acquisition trail in recent months, acquiring Ridleys in July and the Scottish brewery Belhaven in October for 187m. Bankers HBOS (Tuesday) and Royal Bank of Scotland (Thursday) are also on the catwalk this week, with solid pre-close trading updates expected. Strong commentary from commercial and wholesale banking, capital markets and asset management divisions should more than offset the likelihood of flat UK retail results. Analysts will be watching for any signs of asset quality deterioration. HSBC management surprised the market last week with its admission the UK economy was "quite soft" and that the bank was experiencing a tick-up in small to medium-sized enterprise (SMEs) problems. Although not a headliner, SME business is extremely lucrative for such banks as RBoS and HBOS. Bus and train operator, Stagecoach, is expected to post a first-half, pre-tax profit of around 65m on Wednesday. News on Stagecoach's tender for the Greater Western rail franchise is expected before Christmas. Analysts think it has a "good chance" of prising the franchise from competitor First Group. Among companies that seek to benefit from the chilly winter weather is Helphire. The provider of aid to motorists in accidents, posts its interim profit on Monday with analysts expecting a pre-tax result of around 7m. The bulk of revenue is generated in the second half as accident levels rise in icy weather. Among others in the spotlight this week will be Ten Alps on Monday; Northgate Information Solutions and Severn Trent on Tuesday; Centre Parcs on Wednesday and Anite and Premier Farnell on Thursday. Good hunting! I'll need a couple of quiet days to recover from the MoneyAM Christmas do on Friday. It was a great event and really good to see so many old friends. I now need to give my legs a rest after pounding the pavements of London and give my wallet a rest too. I'd forgotten just how expensive some the essentials of life, like beer and wine, are in England. ;-) Greystone (Greystone is Alan English, City Editor at MoneyAM.)

Thanks for all that GS and SM.

Not much on the Divi play front list by the looks of things this week.

Weekend press

Good morning traders!

In Asia today, the Hang Seng was down 13.72 points at 15,186.66 at the midpoint while the Nikkei has just closed ahead up 129.71 points at 15,551.31.

Oil prices were higher in Asian trading as cold weather chilled key areas of the US, raising expectations of a rise in demand for heating oil. New York's main contract, light sweet crude for delivery in January, was up 49 cents at $59.81 a barrel from its close of $59.32 in the US on Friday.

Early broker notes:

XSTRATA INITIATED 'NEUTRAL' AT HSBC, PRICE TARGET 1450P
GO-AHEAD UPGRADED TO 'NEUTRAL' VS 'UNDERWEIGHT' AT JP MORGAN
LEGAL & GENERAL UPGRADED TO 'BUY' AT DEUTSCHE BANK

Happy trading!

G.

LONDON (AFX) - Leading shares are tipped for a cautious start to the week with investors wary ahead of today's pre-budget speech by Chancellor of the Exchequer Gordon Brown, dealers said.
According to spread-betting firm CMC, the FTSE 100 is set to open 2 points higher at around 5,530, having closed on Friday 42.0 points firmer at 5,528.1.

MARKETS
Tokyo: Nikkei closed at 15,551.31, up 129.71
Hang Seng midday: 15,186.66, down 13.72

TODAY'S PRESS
* Oil industry braced for new tax; company profits could be hit in chancellor's pre-Budget report; measures to boost affordable housing expected; growth forecast to be cut drastically - FT
* Blair faces a tough sell to get EU to 'share the pain' of budget cuts plan - FT
* JP Morgan Chase to hire 4,500 Indian graduates - FT
* NTL set for 817 mln stg bid for Virgin Mobile - FT
* PD PORTS, which has recommended a takeover from Australian consortium Endeavour, receives another approach - FT
* Babcock & Brown, the Sydney-based asset financier, attempts to break up the agreed 246 mln stg takeover of PD PORTS by a trio of Australian infrastructure funds - Telegraph

PRESS COMMENT
FT
THE LEX COLUMN comments on Petrodollars (long term impact of rising oil prices on the dollar is negative), Spain's takeover subsidy (Spain may want to build a new world, but not even it can ignore the time value of money), US banks (with the share of financial profits still at almost a third of total US corporate income, earnings pressures have hardly reached boiling point yet)
Independent
Small Talk: Stephen Foley comments on Clear Debt (start of trading pencilled in for Jan 4), Ofex, LANGBAR, EBT MOBILE (a stake of up to 40 pct in the business might be up for grabs, and CARPHONE WAREHOUSE is ahead of a pack of potential investors that also includes VODAFONE), SCOTT TOD (even Nicholas Tod, the ousted chief executive,. thinks he is likely to fail in his bid to get his job back), GALLEON (buys all the rights to Mysti, the fairy sent to live on Earth)

Outlook

Good morning all

End-of-day Market Summary