European markets watch consumer

MARKET OUTLOOK

- US: US markets rose for the fifth week in a row in anticipation of an end of year rally. Trading volume remained low due to Thanksgiving. Last 'Black Friday', the day after Thanksgiving, marked the start of the holiday shopping season.

The National Retail Federation's increased its forecast for 6% retail sales growth during this period. Corporate news should remain rare. Wednesday's 3Q GDP forecast and Thursday's October consumer spending will be key economic data to watch.

The S&P and Nasdaq 100 closed at a new 52w high on Friday. Key supports to maintain the upside bias stand at 1231 (S&P) and 1640 (Nasdaq 100), yet a pause could shape this week.

- EUROPE: European markets gained last week thanks to a weaker euro and a strong Wall Street. On the economic front watch Wednesday's France October unemployment rate and consumer confidence.

The ECB is expected to increase by 25bps to 2.25% its benchmark interest rate on December 1st. Corporate activity should be low this week. Technically, the FTSE 100, Dax and Cac 40 remain above their 20 & 50D MAs and keep upside momentum. The Cac 40 is the only index that has to reach a new 52w high among the three.

COMPANY PREVIEW

Sage Group (GBp 233.75 ; 0.43% ; SGE ; SGE.L)

On Wednesday, Sage Group reports its FY results, the market is looking for of EPS 11 pence expected on revenue of £7.65bln. The group's target price was lifted to 245p from 235p by UBS following Adonix's acquisition but warned however that further gains were far from evident.

Compass Group (GBp 202 ; -2.18% ; CPG ; CPG.L)

On the same day Compass Group will publish its FY results. Net profit is seen down 10% to £580m from £645m a year earlier due to labour and food costs rise. The company was placed under review by the UK's Serious Fraud Office due to corruption allegations in the US over contracts awarded by the UN last week.

Tiffany and Co (USD 43.28 ; 2.63% ; TIF ; TIF.N)

Another firm publishing 3Q results the same day is Tiffany & Co. The market is looking for a profit of $0.16 per share. The jeweler announced it would open 2,100 square foot store in Macau for August 2006, increasing its presence in Asia.

Thyssenkrupp (EUR 17.56 ; 0.63% ; TKA ; TKAG.DE)

Thyssenkrupp publishes 4Q results on Friday, analysts expect net income to drop to E100-110m from E136m a year earlier on sales of E10.5bln down from E11.8bln.

Novell (USD 7.93 ; -1.49% ; NOVL ; NOVL.O)

Finally, Novell will announce its 4Q results the same day. The market is targeting EPS of $0.03. The company announced last week it had appointed Dr Jeffrey Jaffe, formerly at IBM and Lucent Technologies, as Executive Vice President and Chief Technology Officer. The stock is up 17.5 YTD.