TODAY’S FAYRE

TODAY’S FAYRE – Tuesday, 26th August 2014

“Your troubles shrink not, though I feel them less
Here, far away, than when I tarried near;
I even smile old smiles–with listlessness–
Yet smiles they are, not ghastly mockeries mere.

A thought too strange to house within my brain
Haunting its outer precincts I discern:
–That I will not show zeal again to learn
Your griefs, and, sharing them, renew my pain….

It goes, like murky bird or buccaneer
That shapes its lawless figure on the main,
And each new impulse tends to make outflee
The unseemly instinct that had lodgment here;
Yet, comrade old, can bitterer knowledge be
Than that, though banned, such instinct was in me!”

Thomas Hardy – author & poet – 1840-1928

“My hatred of Bolshevism and Bolsheviks is not founded on their silly system of economics, or their absurd doctrine of an impossible equality. It arises from the bloody and devastating terrorism which they practice in every land into which they have broken, and by which alone their criminal regime can be maintained.” – Sir Winston S Churchill – statesman & Prime Minister – 1874-1965

Yesterday’s gathering at Glasgow’s Kelvingrove Art Gallery and Museum to hear Scotland’s independence issue discussed by Alex Salmond and Alistair Darling wasn’t a debate! It was mob oratory by the SNP leader in front of a highly partisan and biased audience, rather poorly mediated by Glen Campbell. I doubt that the ill-mannered shouting will clarified any of the main issues. The occasion did little to enhance the flagging reputation of UK politics. This morning, after the so-called-debate, Ladbrokes were 1/6 for a No! Vote and 7/2 for a ‘YES’ vote

Whilst most of us were watching the rain lashing down on Bank Holiday Monday, punters supporting the DAX and the CAC made some serious measurable progress, based entirely on the perception that Mario Draghi would introduce QE sooner rather than later. Germany’s IFO number was poor. Business sentiment dropped to its lowest level dropped to its lowest level for a year. So once again, silly money props up equity sentiment and the appetite for risk – All madness to me! Just look at those EU bond yields? – Spain’s 10-year yield at 2.25%, with gilts at 2.38%, Italy at 2.48%, not forgetting Germany at 0.95% and France at 1.31%. I understand ECB monetary policy – well I think I do, but these yields seem unrealistic to me! I had to laugh at the news that the French government had collapsed and that President Hollande insisted on support for further austerity, rather different to Draghi’s advice over the weekend of loosening fiscal policy and increase spending on infrastructure throughout the EU!

In the US yesterday despite slightly weak New Home Sales and rather average PMI data, the Street of Dreams was quite happy to push on, though the S&P remained below its recently achieved intra-day ‘high’ of 2000. The main US markets added an average of 0.42% yesterday. It is fair to say that corporate and M&A news helped provide some continued momentum. Roche buying InterMune for $8.3 billion set the ball rolling and Burger King landing Canada’s Tim Hortons in what looked like a tax efficient trade set the ball rolling helped keep the show on the road. However the icing on the cake was Amazon.com trumping Google in paying $970 million for an on-line games website, TWITCH. Twitch has about 55 million visitors and a fair few spend as much as 20 hours a week playing their games! Clearly Twitch will provide a decent platform for digital advertising for Amazon.

This morning there were positive numbers from Bunzl (+3%), an adequate effort from WPP (+1%), which saw earnings up by 3% and growth by about 4% and a dispiriting effort from Regus (-5%). Stagecoach pleased its acolytes with its trading statement. Hypothetically Pzizer could bid again for Astra Zeneca. However with Astra only up by 0.5% it seems unlikely. At 8.45am the FTSE was up 25 points at 6800.

UK companies posting results this week – Wednesday – 888 HOLDINGS, APR ENERGY, POLYMETAL, EVRAZ, FOXTONS, Thursday – STV GROUP, HAYS, MELROSE, PETROPAVLOVSK, LLAYTECH, SALAMANDER ENERGY, UNITE, Friday – BWIN, COMPUTERCENTER & RESTAURANT GROUP.

US companies posting interim results – Wednesday – CHICO’S FAS!, Thursday – ABERCROMBIE & FITCH, DOLLAR GENERAL and FRED’S, Friday – BIG LOTS.

These are David Buik personal views

Twitter – @truemagic68

David Buik

Market Commentator

D +44 (0)20 7886 2775
Panmure Gordon & Co
One New Change | London | EC4M 9AF | United Kingdom
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