Barclays, Sainsbury’s and Aberdeen group are due to make key announcements in a busy corporate week ending with the all-important vote by shareholders in the Baillie Gifford US Growth Trust.
There are also updates on the economy with UK jobs data and inflation providing some pre-Budget guidance for the Chancellor and the markets. CPI inflation s predicted to accelerate to an average of 3.4% to 3.6%.
The battle for the BG US Growth Trust will culminate in a hard-to-call vote on Friday as shareholders must choose between the current manager and the resolution from US predator Boaz Weinstein whose investment vehicle Saba Capital Management is making a third attempt to install three directors on the board.
BG US Growth Trust invests in companies such as the AI business Anthropic and payments firm Stripe and Weinstein is accused of exploiting loopholes in the City rules to acquire the management contract without paying a takeover premium.
Saba recently increased its stake to around 29.9%, just below the threshold at which it would be obliged to make a takeover offer for the trust.
Retail shareholders make up about half the total and the managers hope they will reaffirm their previous opposition to Saba.
The deadline for private investors who use investment platforms closed last Friday but a lot rests on how fellow New York hedge fund Sessa Capital votes. It has also increased its stake to 7.7% and is believed to be favouring Saba.
Trust manager Tom Burnet said last week: “We have a minority shareholder who is interested only in the commercial outcome, rather than the outcome for other shareholders.” Mr Burnet believes Mr Weinstein is trying to exploit a low level of voting among private shareholders.
Mergers and acquisitions are likely to overshadow half-year results at Sainsbury’s on Thursday after recent reports about a possible multi-billion-pound tie-up with rival Morrisons.
“It only seems like yesterday that Sainsbury’s proposed takeover of Asda in 2019 was blocked by the competition regulator, which begs the question of what has changed in UK food retailing to make mega-deals more palatable,” say AJ Bell analysts, who also ask how long Sainsbury’s can maintain market share gains while making cost savings to offset rising input costs.
“This will be key for free cash flow, dividends and share buybacks.”
Barclays will kick-off the banks’ third quarter earnings season and Interactive Investor notes that its shares were as high as 522p in August after forecast-beating second-quarter results included an upgrade to its 2026 income target.
However, the shares ended the third quarter as the worst performing of the sector amid concern over the company’s exposure to the US economy and softer period of fee income from investment banking activity.
The quarterly decline of 9.7% included September’s 7.9% reverse in a month when the Federal Reserve hiked interest rates. The shares today trade around 430p, which compares with Bank of America’s price target of 580p.
Aberdeen Group and Halfords are among a number of companies issuing trading updates. In the US, there are figures from Meta, Netflix and Tesla.
Monday 19 October
- Full-year results from Beeks Financial Cloud, ITM Power
Tuesday 20 October
- UK average earnings for August and jobs data
- In the US, quarterly results from GE Aerospace, Philip Morris and Netflix
Wednesday 21 October
- Trading updates from Aberdeen, Halfords, Persimmon
- UK consumer and producer price inflation for September
- In the US, third-quarter results from Meta, Tesla and Texas Instruments
Thursday 22 October
- Half-year results from Sainsbury’s and Bloomsbury Publishing
- Third-quarter results from Barclays
- Trading updates from Intercontinental Hotels, Rentokil, London Stock Exchange, Inchcape and IG Group
- In the US, quarterly earnings from Procter & Gamble
- US weekly jobless claims
Friday 23 October
- Baillie Gifford US Growth Trust AGM
- GfK consumer confidence
- In the US, quarterly earnings from ExxonMobil and American Express
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