Tuesday preview: US jobs data, Aveva in the spotlight

Financial markets' focus will continue to be on the US jobs market in the run-up to the Federal Reserve's policy meeting scheduled for the next day.

The National Federation of Independent Businesses' small company confidence index for May and the Fed's JOLTS labour market survey for April will be scrutinised for confirmation or hints regarding the previous Friday's blowout May non-farm payrolls report.

According to one analyst in City, that report, which had shown a 2.51m rise in hiring (consensus: -8.0m) had left "red faces all round" as no one had correctly anticipated the massive positive surprise.

No major economic releases are scheduled in the UK.

Across the Channel, foreign trade data covering the month of April are due out in France and Germany, together with a reading on industrial sentiment in the former.

The biggest corporate due to update markets on Tuesday is industrial software maker Aveva.

UBS's Michael Briest expects the engineering arm will have been softest since the start of the new financial year in April because it is at the start of the design cycle.

Asset performance management and Planning and Operations on the other hand were expected to have shown greater resilience.

For the 2020 financial year, Briest had penciled-in £834m in sales (consensus: £833m) for earnings before interest, taxes and amortisation up by 25.9% to reach £216m (consensus: £213m).

The company's transition towards a subscription model and the flexibility afforded to clients may help it in 2021, the same analyst added.

Yet with 2021 set to be a difficult year for the entire industry, investors would likely focus on management's confidence in being able to reach its target for 30% margins by the end of FY 2022.

Briest, like the consensus, was anticipating margins of 27.4% in 2022 rising to 29.4% in 2023, that is to say that the goal would be pushed out by one year.

"Not reiterating the ambition at all would be negative we think," he said.

"A hiring and salary freeze was confirmed on 16 April already. With a solid balance sheet and the company saying in April that it "does not intend to furlough any staff, or make use of government support programme" if this remains the case it is likely the pay-out will be made, we believe.

"We note majority owner Schneider Electric paid its FY19 dividend recently."

Tuesday 09 June

GMS

Equatorial Palm Oil, Tissue Regenix Group

FINALS

Aveva Group, Big Yellow Group, CML Microsystems, Mckay Securities, Oxford Instruments, Schroder Real Estate Investment Trust Ltd, Speedy Hire

EGMS

Alpha Real Trust Ltd.

AGMS

Albion Development VCT, Kakuzi Ltd., Menhaden, Nostrum Oil & Gas , S&U, Silence Therapeutics, Somero Enterprises Inc. (DI)

FINAL DIVIDEND PAYMENT DATE

Globaldata