London pre-open: GCC and Weidmann in the spotlight

12th Sep 2012 07:30

City sources predict the FTSE 100 will open down four points from yesterday's close of 5,792, taking the lead from markets in Europe. On today's schedule, the highest court in Germany (GCC) will announce its ruling on whether the country considers its participation in the permanent European Stability Mechanism (ESM) bailout fund to be constitutional or not. The decision is now expected towards 09:00. Conditions may well be attached to any approval.EC President Barroso's proposal for a banking union is also due out this morning (towards 09:00). A speech by Bundesbank President, Jens Weidmann, later in the morning, could also attract some attention. Also on the agenda this week is a policy announcement from the Federal Reserve, due to take place tomorrow. Expectations are high that the Fed will introduce more stimulus action (or of some sort at least) following the most recent US non-farm payrolls report, which came in well below expectations. Back in the UK, the ONS will publish its labour market data at 09:30. Consensus is forecasting the July ILO unemployment rate unchanged at 8.0% and the claimant count at 0. Average earnings growth is estimated to have slowed to a 1.4% quarterly and on year rate while and core earnings growth should have edged up to 1.9%.Yesterday evening MPC member David Miles defended the effectiveness of the Bank of England's quantitative easing policy.Wet weather and adverse exchange rates have put a dampener on the first half performance of do-it-yourself retailer Kingfisher. Sales in the 26 weeks to July 28th were down 3.3% to £5,478m from £5,662m at the interim stage last year. That was in line with market forecasts. On a constant currency basis, sales were up 1.0% but on a like-for-like (LFL) basis were off 2.8%. Statutory profit before tax fell 16.9% to £364m from £438m the year before. Anglo-Swedish drugs giant AstraZeneca has tapped the bond market with an issue of notes in two tranches. The group has successfully issued $1bn of 7-year fixed rate notes with a coupon of 1.95% and $1bn of 30-year fixed rate notes with a coupon of 4%. The proceeds of the issue will be used for debt refinancing and general corporate purposes. The description of house builder Barratt Developments as 'debt-laden' is set to become a thing of the past after a bumper year which saw profits and net debt almost halved. Group revenue in the year ended June 30th up by 14.1% to £2,323.4m, with completions well ahead at 12,637 units versus 11,078 completions the year before. Full year profit before tax and exceptional items increased by 159.3% to £110.7m from £42.7m) the previous year.