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UK stock market morning note (February 26, 2013)

The FTSE 100 is called to open lower this morning following the declines on Wall Street and in Asia overnight as the Italian election results left the country facing a political stalemate. Investors in addition to this fresh uncertainty surrounding the euro zone will also have some key UK and US economic data to digest during the session. This includes the Bank of England Governor giving evidence to the Treasury Select Committee, the latest CBI Distributive Trades Survey data and this afternoon, US consumer confidence, new home sales figures and a speech from the Federal Reserve Chairman. Commodity prices are flat to slightly lower with gold trading below the USD1,600/oz level again and on the foreign exchanges, the pound is up slightly against both the dollar and the euro.

Company Announcements

Whitbread Q4 Trading Statement reports that lfl sales in the 11 weeks to 14 February 2013 rose 2.7% taking lfl sales for 50 weeks to 3.7% and total sales ahead 16.9% and 14.8% respectively. Growth was again driven by Costa and stated that it was on track to deliver full year results in line with expectations. It added that it sees no change in market conditions, although it expects a more competitive environment. The company sees continuing good organic growth and is on track to achieve its 2016 growth milestones.

GKN Final Results saw reported PBT up 68% to GBP588m on reported sales ahead 13% at GBP6.51bn. On a management basis, PBT grew 19% to GBP497m on sales up 13% at GBP6.9bn. The total dividend is raised 20% to 7.2p with record profits achieved across its four divisions. It added that with the benefit of a full year contribution from Volvo Aero, it expects 2013 to be a year of 'good progress'.

Imperial Tobacco Investor Event. The presentation today will outline its intention to grow dividends by at least 10% per annum for the medium term together with its cost programme which will see some benefits this financial year. From October 2013, the latter will deliver further savings of around GBP300m per annum by September 2018. It added that full year results remain in line with its expectations.