Thursday preview: ECB to announce QE expansion, analysts expect

European Central Bank President Mario Draghi on Thursday is expected to announce a new set of policy measures to address a prolonged weakness in Eurozone inflation.

Eurozone inflation rose 0.1% in the year to November, unchanged from the previous month and below estimates of 0.2%, according to the 'flash' estimate from Eurostat on Wednesday, adding pressure on the ECB to take action. The ECB is targeting inflation of just below 2%.

"November’s weaker-than-expected Eurozone consumer prices figures give a final green light for the ECB to both increase the pace of its asset purchases and cut its deposit rate at tomorrow’s policy meeting," said Jonathan Loynes, chief European economist at Capital Economics.

Danske Bank expects the ECB to cut the deposit rate by 20 basis points along with an expansion to the quantitative easing to €75bn per month until December 2016. The ECB currently has asset purchases at €60bn per month, with an intended finish date of September 2016.

The bank also sees the ECB lowering its outlook on core inflation at the policy meeting

“The lower core inflation forecast from the ECB should mainly be the result of the euro appreciation, as this is expected to be a headwind to goods price inflation,” according to Danske senior analyst Pernille Bomholdt Henneberg.

“In response to the outlook for lower core inflation, we expect the ECB to fulfil the high market expectations by delivering an aggressive package of easing measures tomorrow.”

Meanwhile, Thursday’s economic data calendar will include a batch of service activity purchasing managers’ index reports on Japan, China, Eurozone, the UK and the US.

Figures on US durable goods orders, factory orders and weekly jobless claims will be published, while the Eurozone will also see the release of retail sales data.

Thursday 03 December

INTERIMS

Clipper Logistics , IMImobile , Market Tech Holdings Limited , Mercia Technologies , Smith (DS), WYG

INTERIM EX-DIVIDEND DATE

B&M European Value Retail S.A. (DI), Baronsmead VCT, Caledonia Investments, Charles Stanley Group, Creston, Croma Security Solutions Group, De La Rue, Downing Four VCT DP2011 Low Carb, Downing Four VCT DP2011 Str, Downing Four VCT DP2011Gen, Electrocomponents, Establishment Inv Trust, First Property Group, Foresight 4 VCT, Fuller Smith & Turner, GLI Alternative Finance , Headlam Group, Helical Bar, Hogg Robinson Group, IS Solutions, JD Sports Fashion, Kainos Group , LondonMetric Property, Management Consulting Group, Norcros, PayPoint, Record, Royal Mail, Sepura, Severn Trent, Shanks Group, Tarsus Group, Telecom Plus, TR Property Inv Trust, Triple Point Income VCT, UK Mail Group , ULS Technology , Value and Income Trust, VP

QUARTERLY EX-DIVIDEND DATE

Alpha Real Trust Ltd., Bank of America Corp., Duet Real Estate Finance Ltd, Land Securities Group, Premier Energy & Water Trust

INTERNATIONAL ECONOMIC ANNOUNCEMENTS

ECB Interest Rate (EU) (12:45)

ISM Non-Manufacturing (US) (15:00)

ISM Services (US) (15:00)

PMI Composite (EU) (09:00)

PMI Composite (GER) (08:55)

PMI Services (EU) (09:00)

PMI Services (GER) (08:55)

Retail Sales (EU) (10:00)

Q4

GW Pharmaceuticals

GMS

Jupiter European Opportunities Trust, Northern Petroleum, Pembroke Vct

FINALS

Elegant Hotels Group , Impax Asset Management Group

SPECIAL DIVIDEND PAYMENT DATE

Manchester & London Investment Trust

SPECIAL EX-DIVIDEND PAYMENT DATE

Alliance Trust, Premier Energy & Water Trust, Rights & Issues Inv Trust Capital Shares

EGMS

Minera IRL Ltd.

AGMS

Advance Frontier Markets Fund Ltd, ASOS, AXA Property Trust Limited, Egdon Resources, Haydale Graphene Industries, Powerhouse Energy Group, Quoram

TRADING ANNOUNCEMENTS

Amino Technologies

UK ECONOMIC ANNOUNCEMENTS

Official Reserves (09:30)

PMI Composite (09:30)

PMI Services (09:30)

FINAL DIVIDEND PAYMENT DATE

Manchester & London Investment Trust, Regenersis, Wolseley

FINAL EX-DIVIDEND DATE

A&J Mucklow Group, Aviva 8 3/4% Cumulative Irrd Preference 1, Bellway, British Empire Trust, Britvic, Daily Mail and General Trust A (Non.V), Debenhams, Downing Four VCT DSO 'B' Shs, General Accident 'A', Greencore Group, Mitchells & Butlers, Northamber, Origin Enterprises, Royal Bank of Scotland 11% Cum. Prf, Royal Bank of Scotland 5.5% Cum. Prf., Town Centre Securities, UDG Healthcare Public Limited Company, Volta Finance Limited, YouGov