Companies reporting next week

THE London market should take its lead from economic news next week as the Bank of England's interest rate decision and a number of key surveys are expected.

Scottish & Newcastle, the only blue-chip company set to report, will put investors in the picture on Wednesday regarding the acquisition of Finnish drinks business Hartwall - a deal which will give the company a far greater reach into the lucrative eastern European market.

As for S&N's full-year results, fund manager Gerrard's expects pre-tax profits before exceptional items of £435m, compared with £428m a year earlier.

It has been a busy year for pubs and brewing group Greene King, which is due to post final figures on Friday. Nine months ago it snapped up Old English Inns' 136 outlets in a £59.1m deal and pre-tax profits are expected to grow accordingly. Analysts are forecasting a rise from £59.7m last year to £68.8m.

Car dealership Reg Vardy will be hoping to show the City how it has driven up profits on Wednesday when it posts full-year figures.

It has benefited from strong demand recently, fuelled by low interest rates and Government moves to bring UK car prices into line with those in mainland Europe.

The half-year saw a 63% surge in pre-tax profits, and the City is expecting a similar performance for the full-year. Pre-tax profits are pencilled in to rise from £24.3m last year to £32.5m.

On Wednesday, supermarket chain Somerfield steps up to unveil its full-year figures. The retailer is in the middle of a five-year recovery plan designed to revive both the supermarket brand and its Kwik Save discount stores. Most analysts are expecting the group to move back into the black, from pre-tax losses of £13.1m last year to pre-tax profits of £20.3m this time.

The Bank of England has braced homeowners for an increase in interest rates, although recent events mean it is now unlikely to be next week.

Uncertainty over the global recovery and the weakness of stock markets will convince members of the Monetary Policy Committee that the timing is not right when they meet on Wednesday and Thursday.

But analysts believe that barring another major knock to economic confidence, rates will rise from their 38-year low of 4% to curb spiralling house prices and prevent inflation from overheating in the long-term.

The major economic news of the week will be provided by the Chartered Institute of Purchasing & Supply through its surveys on Monday and Wednesday into the state of manufacturing and the service sector respectively.

The manufacturing index was in positive territory for a fourth consecutive month in May, although the rate of growth eased slightly.

In services, the index rose sharply between April and May, but this is unlikely to be maintained as consumers show signs of tightening up on spending.