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UK stock market morning note (January 10, 2013)

The FTSE 100 is called to open flat to slightly higher this morning ahead of the interest rate announcements from the Bank of England and European Central Bank at lunchtime with no change in rates expected from either party. Overnight we had better than expected trade data out from China which may help market sentiment at the outset. In addition to the central bank news, lunchtime will also see the release of the latest US weekly jobless claims. Commodity prices are firmer and on the foreign exchanges, the major currencies are trading in narrow ranges with the pound and euro slightly lower against the dollar.

Company Announcements

Rolls-Royce Appointment. It has announced the appointment of Lord Gold, who was a solicitor at Herbert Smith for 37 years to lead a review of its compliance procedures. This follows on from the previous announcement that the company had provided information to the Serious Fraud Office on concerns about bribery and corruption involving intermediaries in overseas markets.

Marks & Spencer IMS confirms figures released last night that UK lfl sales in the 13 weeks to 29 December fell 1.8% as weaker general merchandise sales (-3.8%) offset a small growth in food sales (+0.3%). Group sales grew 0.6% on a constant currency basis with total UK sales up 0.3%. International sales rose 4.1% with multi-channel sales ahead 10.8%. It noted that for the 14 weeks to 5 January 2013, lfl sales increased by 0.9%. It added that it expects pressure on consumers disposable income to continue in 2013 and hence remains cautious on the outlook for the year ahead.

Tesco Christmas and New Year Trading Statement reports that UK lfl sales in the 6 weeks to 5 January 2013 rose 1.8% ex VAT and fuel driven by a stronger food performance. Group sales were ahead by 3.8% including petrol. Sales in Europe fell 3.6% of a lfl basis excluding petrol, Asia was down 0.2% with US 2.1% lower in the period. There was a strong contribution from online and the outlook for the full year for the UK is unchanged. It also announced that Chris Bush who has over 30 years experience at Tesco will become UK Managing Director.