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UK stock market morning note (March 21, 2013)

The FTSE 100 is called to open slightly lower this morning with the FOMC remaining cautious on US growth and concerns over Cyprus impacting upon sentiment. The latter's President is expected to launch a 'plan B' today in a bid to secure a bail out with the country's banks to remain shut until next Tuesday. Overnight we had the flash HSBC Chinese manufacturing PMI data out which came in above forecast at 51.7. There is a raft of domestic and US economic data due for release for investors to digest including UK retail sales, public sector net borrowing and industrial order expectations. These will be followed in the US at lunchtime with the latest weekly jobless claims, flash manufacturing PMI, existing home sales and the Philly Fed manufacturing index figures. Commodity prices are firmer and on the foreign exchanges, the pound is up against both the dollar and the euro.


Company Announcements

Next Final Results saw underlying PBT rise 9% to GBP621.6m on revenue ahead over 3% at GBP3.55bn. Next Directory saw sales rise 9.5% with both it and Retail increasing their operating margins in the period. Cashflow was strong and the full year dividend is raised 16.7% to 105p. It added that it anticipates another 'challenging year ahead' with little if any growth in the UK retail economy and will again aim to achieve growth by brand investment, product improvement, cost control and returning cash to shareholders.  

AstraZeneca Strategy Statement. It has outlined a plan to return to growth that will include a reduction of 2,300 in headcount in its SG&A activities and result in benefits of around USD800m by 2016. There is a commitment to maintain its progressive dividend policy with a target cover of 2x core earnings over the investment cycle. Separately, it has agreed to an exclusive deal with Moderna to develop RNA therapeutics whereby Astra will make an upfront payment of USD240m. It also announced that it is to create a Translational Research Centre with the Swedish medical university, Karolinska Institutet in Sweden. Astra will contribute up to USD20m per annum with the centre expected to be operational by mid 2013.