TODAY’S FAYRE – Wednesday 25th February 2015




Poet of Nature, thou hast wept to know

That things depart which never may return:

Childhood and youth, friendship, and love’s first glow,

Have fled like sweet dreams, leaving thee to mourn.

These common woes I feel.

One loss is mine Which thou too feel’st, yet I alone deplore.

Thou wert as a lone star whose light did shine

On some frail bark in winter’s midnight roar:

Thou hast like to a rock-built refuge stood

Above the blind and battling multitude:

In honoured poverty thy voice did weave

Songs consecrate to truth and liberty.

Deserting these, thou leavest me to grieve,

Thus having been, that thou shouldst cease to be.



Percy Bysshe Shelley – poet – 1830-1886


   A double hundred on a village green in 50 overs would take some getting, but in a World Cup match against Zimbabwe, West Indies Chris Gayle scored 215 in 149 balls including 16 sixes – a world record in this competition. It was quite a spectacle. In full cry Gayle is a sight for sore eyes!


   I sincerely hope that FIFA are not allowed to get away with allowing Qatar to host the World Cup at Christmas in 2020. I hasten to add that I have nothing against Qatar being the host nation – I welcome them! However FIFA is a shambles. It is such a pity that the World Cup cannot become the responsibility of another federation. My colleague and friend, Simon French sets out four good reasons why this decision is a poor one, as far as Europe and the UK is concerned


The Premier League: What happens to the schedule? The rights (worth £5.1bn at the last auction) are sold around the world and are a great British export. These will be disrupted in 2022 and revenues reduced accordingly should the PL have to play games over a tighter period/ without their WC players or during the typical off-season. Club revenues (gate receipts) will also be affected.


       Summer Leisure: The World Cup is associated with spikes in leisure, food and alcohol sales. Pubs will be affected as poorer weather will reduce the propensity to “go out” and certainly to hold outside screenings!


       Productivity: A summer World Cup coincides with a typical lull in productivity as work patterns get disrupted by summer holidays. Putting the WC in a less naturally disrupted period will reduce productivity still further.


     Christmas: Its tough enough getting men off the sofa to do the Xmas shopping. It will be doubly hard in 2022! Retailers will have to innovate – how long before the online retailers’ team up with the bookies to allow you to bet/Christmas shop “in play”?


Investors have nearly drowned in buckets of blood, sweat and tears for 15 years waiting for the 31stDecember 1999 FTSE 100 record of 6930 to be finally eclipsed.  It finally materialised yesterday – to 6949.


A crescendo of frothy and hysterical support for ‘TMT’ stocks such as Pearson, BskyB, BT, Vodafone, LogicaCMG, ARM, Durlacher, Freeserve, ITV, Autonomy and Sage catapulted the FTSE 100 to its record level on 31st December 1999.  Then in 2000 unrealistic valuations started to unnerve analysts and the ‘bubble’ finally burst on the back of the collapse of the NASDAQ and the obliteration of Neuer Markt in Germany, which wiped billions off the value of these speculative stocks.  Other constituent companies that were grossly over-valued at the time were the new banks on the blocks such as Abbey National, Halifax, Woolwich, Alliance Leicester and Northern Rock.


The threat and culmination of war in the Middle East blew in our ears.  Once the bombs started falling on Baghdad in March 2003 the FTSE fell to 3283.  The recovery was sharp and the gradual for 5 years up to 6,550 until the credit crisis took no prisoners amongst the constituent stocks within the FTSE.  The FTSE 100 then fell to 3510.   We were then obliged to pay homage to the Bank of England for introducing quantitative easing on 9th March 2009, which has underwritten the equity recovery, eclipsing 1999’s record of 6930.  We must also be grateful for having interest rates at 0.5% for 71 months, making alternate assets unattractive, with share dividends yielding between 2.5% and 5%.


Since 1999 the constituent stocks of the FTSE has changed out of all recognition.  Banks, technology, telecoms and media have diminished in value. Oil companies have improved slightly – BP, Shell, Cairn and BG Group despite recent setbacks. Tobacco, drugs, utilities and mining have become hugely important, as have some retail stocks such as AB Foods, Next and Burberry.  Some companies have been sold to overseas predators such as ICI, Blue Circle, Cadbury Schweppes and Hanson Trust to name but a few. GE/Marconi was destroyed without trace – Lord Weinstock RIP! Tut Lord George Simpson! Only 60% of the stocks that were in the FTSE 100 in 1999 are there today!What about the future? The UK economy seems in good nick; the US economy definitely is and Europe may be coming back on the bridle, though I don’t share the majority’s optimism on that score. Provided geopolitical problems from Russia and the Middle East don’t become untenable, there may well be more juice in the FTSE’s tank!


On the Street of Dreams yesterday Janet Yellen’s testimony in her Humphrey Hawkins lecture to Congress was dovish and conciliatory enough for market geeks to believe that the FED will not move to put rates up until towards the end of 2015, though she did leave the door slightly ajar, in case employment data looked really robust and inflation headed towards or above the 2% threshold target. Hewlett-Packard disappointed its acolytes by failing to beat guidance – $1.5 billion light on a strong Dollar. The shares fell by 6.9% after hours. At the end of the session the DOW was +0.51%, the S&P was better by 0.28% and the NASDAQ by a parsimonious +0.01%. Asia was mixed with the Hang Seng up 0.43% at lunch with the NIKKEI closing just 0.1% down.


This morning there were strong trading statements or results from Whitbread, TSB, Barratt Development and St James’s Place. Efforts by Petrofac and Hays were satisfactory. It is interesting to note that RBS shares have rallied 11.5% in 4 weeks to 404p. Hope tomorrow’s results are good!


Markets took little notice of Greece agreeing a nonsensically fudged deal with the Troika, kicking the can down the road for another 4 months. How nebulous was this criteria for agreement?


  • Combat tax evasion
  • Tackle corruption
  • Commit not to roll back already introduced privatisations, but review privatisations not yet implemented
  • Introduce collective bargaining, stopping short of raising the minimum wage immediately
  • Tackle Greece’s “humanitarian crisis” with housing guarantees and free medical care for the uninsured unemployed, with no overall public spending increase
  • Reform public sector wages to avoid further wage cuts, without increasing overall wage bill
  • Achieve pensions savings by consolidating funds and eliminating incentives for early retirement – not cutting payments
  • Reduce the number of ministries from 16 to 10, cutting special advisers and fringe benefits for officials 
  • David Buik – market commentatorPanmure Gordon & Co D +44 (0)20 7886 2775 – mobile – 07788 144 877


  • Panmure Gordon & Co  One New Change | London | EC4M 9AF | United Kingdom

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