Today’s Fayre

TODAY’S FAYRE – Sunday 10th May 2015



“Fight the good fight with all thy might;

Christ is thy Strength, and Christ thy Right;

Lay hold on life, and it shall be

Thy joy and crown eternally.


Run the straight race through God’s good grace,

Lift up thine eyes, and seek His face;

Life with its way before us lies,

Christ is the Path, and Christ the Prize.


Cast care aside, upon thy Guide,

Lean, and His mercy will provide;

Lean, and the trusting soul shall prove

Christ is its Life, and Christ its Love.


Faint not nor fear, His arms are near,

He changeth not, and thou art dear.

Only believe, and thou shalt see

That Christ is all in all to thee.”



70th anniversary of VE Day – Westminster Abbey

Thank you!



Despite the amazingly upbeat outcome of last week’s general election for business, the UK remains a highly fractious and divided nation, as was illustrated by a seriously unpleasant austerity mob behaving disgracefully outside N:10! The Conservative government must be seen to stimulate social mobility and inequality or we will see a repetition of this loutish behaviour. PM Cameron knows this, if he wants to be seen as a unifying leader? There will be problems negotiating with Europe. as we read in the Telegraph this morning with the Europhiles having massed their troops – BAE Systems’ Sir Roger Carr, BT’S Gavin Patterson, WPP’S Sir Martin Sorrell – all making it clear that the EU is the only way forward. They would wouldn’t they. This referendum must not be a charade. PM Cameron must not lie on his back and let Merkel tickle his tummy! – There, there, Dave! Better? The negotiations must be tough, uncompromising and relentless.

Then the thorny subject of SNP and the supremely confident and bumptious M/S Sturgeon, who is very much in the driving seat for Scotland. Yes the SNP has 56 seats from 1.5 million voters. The PM must play a long game with Scotland, slowly accommodating some Scottish wishes, which were promised at the referendum. However if Sturgeon and Salmond think they are going to dominate this parliament, they delude themselves. The Conservatives have a majority, whether the manicured Glaswegian ‘pocket battleship’ likes it or not! Wait your turn M’Lady! I hope the media stop putting her at the top of the agenda on every programme!  Standard Life, RBS and other Scottish business giants have already expressed their concern over the SNP’S very left-wing agenda.

It looks as though Sajid Javid may replace Dr Cable as BIS Secretary. He was a successful banker with Chase Manhattan and Deutsche Bank and a front bench high-flyer, but I would trumpet and champion the credentials of Lord Livingstone, who may be in the Lords, but this ebulliently successful former CEO of BT would tick every single box with his tireless commitment to the cause and satisfy business’s requirements.



Spare a thought for Nick Clegg. I have no empathy with his politics but he is a decent and honourable man. He put country before party and paid the price. I wish him and his family peace and happiness.

As Friday morning dawned the United Kingdom seemed a totally different place. Business confidence for the future had been restored. The hopes and aspirations for many were rekindled. The threat of a venomous attack on wealth, profit and deficit promulgated by Messrs Miliband and Balls had finally dissipated. Markets girded up their loins and the prospect of a government with a mandate, however small, triggered a decent stock market relief rally, in the the knowledge that reticent investors would return to the fold. Potential IPOS could be dusted off the shelf with likelihood of financial M&A teams starting to select another gear. Sirius Minerals could be the first looking to raise £1 billion to finance. North Yorkshire mine. Chancellor Osborne will probably looking to raise its game in selling tranches of Lloyds Bank and RBS, now that market conditions look superficially better. However the appetite for bank shares is limited at present, even with a discount to share price being offered.

Yesterday the FTSE 100 rose like the proverbial grille adding 2.3% – 158 points to 7046. Not surprisingly it was banks, utilities, house builders, bookmakers, property and estate agents who were in the vanguard driving values up sharply – examples include Barclays 3.5%, Ladbrokes +9.9%, Barratt 7.1%, Taylor Wimpey 5.8%, Savills 9.4%, Foxtons 9%, Capita 6.7%, Centrica 5% and even Serco put on 6%! – In fact all the sectors that Labour promised to crush ended the session in good spirits. Not surprisingly Sterling put on its best ‘bib & tucker’ regaining over 3% in value over the week. Oil also rose quite sharply with Nymex testing the $60 a barrel threshold.

This move must only be construed as cautious optimism and a relief rally at best. There are still so many imponderables to threaten global markets. The bond market has suffered the worst trashing since the 2008 financial crisis. The current Greek financial crisis resembles a ‘Fred Karno Circus’ production. These negotiations does no credit to Greece or the EU/ECB/IMF.  The world’s markets are beginning to laugh with uncontrolled hysteria at the lack of competence and resolve.

 China’s recovery continues to look very brittle requiring extra stimulus, which the Chinese authorities seem to have an unlimited supply of – for the time being. QE is clearly not working in Japan. Until Abe-San gets cracking with some real infrastructure projects, I fear nothing will change. Many will have had butterflies in their stomach at the sight of Putin and his allies including China parading a terrifying arsenal of weapons through Red Square yesterday for the May-Day parade. Putin’s ‘Giaconda’ smile remains terrifying, now that the sun is high on the yard arm over Ukraine. The unpleasantness will surely become more evident, with the possibility of unrest in the Baltic becoming a very unappetising prospect. Heading west the US’S economic recovery still looks patchy. Friday’s Non-Farm payrolls were better than had been predicted – 223k jobs were created in April with unemployment remaining at 5.4% – its lowest level since May 2008. This news will rekindle Janet Yellen’s energies to hike rates – maybe only symbolically in the late summer or early autumn. The S&P 500 rose by 1.4% on Friday. Looking at the outlook for earnings, few expect quarters three and four to be bonanza material. Last week the S&P 500 added 0.38%, the FTSE 100 0.87%, European stocks 1.26% and the NIKKEI, having been closed for much of golden week lost 0.78%. The Shanghai Composite and the Hang Seng were given some very visceral treatment early last week but recovered some poise on Thursday and Friday.


US companies posting interim results – Monday – GAP! SOTHEBYS, Wednesday – RALPH LAUREN, CISCO SYSTEMS, JC PENNEY, Thursday – APPLIED MATERIALS, NORSTROM 19th May – WALMART, HOME DEPOT, 20th May – TARGET

Economic dates – Monday – BOE rate decision, Wednesday – BOE INFLATION REPORT.



David Buik – market commentator


Panmure Gordon & Co



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