TODAY’S FAYRE – Wednesday 24th June 2015


“As I walked out one evening,

Walking down Bristol Street,

The crowds upon the pavement

Were fields of harvest wheat. 


And down by the brimming river

I heard a lover singUnder an arch of the railway:

‘Love has no ending. ‘I’ll love you, dear,

I’ll love youTill China and Africa meet,


And the river jumps over the mountain

And the salmon sing in the street, 

‘I’ll love you till the oceanIs folded and hung up to dry

And the seven stars go squawkingLike geese about the sky. 

‘The years shall run like rabbits,


For in my arms I hold

The Flower of the Ages,

And the first love of the world.’ 

But all the clocks in the cityBegan to whirr and chime:

‘O let not Time deceive you,You cannot conquer Time.


 ‘In the burrows of the Nightmare

Where Justice naked is,

Time watches from the shadow

And coughs when you would kiss.”


 WH Auden – poet – 1907-1973


Standard & Poor’s, the rating agency says Brexit could “significantly dent” UK financial services and insurance sectors. I don’t buy that – just jingoistic sabre rattling!


How impertinent of “The Pro-European Business for New Europe” to rubbish “Business for Britain’s” report and calculations in ‘Change or Go!’ as spurious, misleading and built on sand. I can assure M/S Lucy Thomas that BfB’s Matthew Elliott, Robert Oxley know exactly ‘how many beans make four’ when it comes to have the drains up on the ‘pros and cons’


How many rumours have we had about the possible sale of CVC Partners/Bernie Ecclestone stake in Formula 1 for prices varying from $5 to $10 billion in the past few years? He may be well into his 9th decade but our ‘Bern’ is surely as durable and robust as any other hard-nosed businessman. However ‘anno domini’ creeps up and someday the finishing line will be in this venerable genius’s sights! So the idea that Miami Dolphins owner Stephen Ross in conjunction with Qatar should jointly bid about $8 billion for 35.5% stake in ‘Formula 1’ is not that an outrageous prospect.


I will leave you to the public’s obsession with Greece’s fate to those who follow this never ending saga, which could reach a temporary conclusion tomorrow afternoon, when it is thought there will be some kind of accord, which PM Tsipras will have to put to the Greek Parliament/people – Good luck! It will, of course be only a temporary resolution. However the fact that it is thought that the ECB has temporary loans out with Greece/Greek banks totaling close to €140 billion, it seems unlikely that the EU/IMF will pull the plug. This saga will end up being a weeping sore for 20 years and will inevitably damage the overall credibility of the EU.


Whatever I think of Greece’s crisis is of no consequence at all. Equity geeks in Europe added further froth to the main indices – DAX up 1.3% and the CAC 1.4%. The FTSE just kept a sense of proportion – up 17 points at 6848. As discussed yesterday Ladbrokes grabbed most of the headlines – up 17%! Panmure’s Karl Burns, on limited information provided, believes this deal with Coral/Gala could be a ‘stonking’ one. If the value of Corals is on a similar ebitda to Ladbrokes, the ‘Magic sign’s’ share price could push on. Coral’s technology will be ‘key’ and it seems as though the joint venture will have to lighten up the size of its retail operation by 20% so as not to incur the wrath and indignation of the Competition Commission. RBC put out an encouraging note on Sports Direct and their drive to push ahead with on-line sales – +3%. In the US, the Street of Dreams made modest gains thanks to robust housing data, though progress was slightly dampened by poor factory activity. The DOW closed +0.13%, the S&P =0.06%, though the NASDAQ reached an all-time record – +0.12%. Facebook put on 3.7% yesterday to $88.70 a share, valuing the company’s share capital at $238 billion – now a larger company than Wal-Mart. Asia was mixed though the NIKKEI (+0.61%) reached its highest level since 1996 at 20k+, though miles away from the 38K achieved in 1987 before the crash. The Hang Seng was up 0.36% towards the close and the Shanghai Composite, having spent much of last week in negative territory (-13% last week), was up 1.96% heading to sunset.


Slightly disappointing UK house sale figures were produced by HMRC for May – only 98,000. This is hardly surprising considering the outcome to the General Election remained in doubt until the last moment. Estate agents have rarely been quieter in the months leading to 7th May 2015! June and July should see greater activity. Up to the credit crisis in 2009 there were 1.7 million transactions. This fell to 898k in 2010 and last year the number was back to 1.2 million still some way short of the halcyon days, due to restricted mortgage lending and a shortage of houses. John Lewis, which is involved in about 10% of all UK retail electrical business hope to crack on in the mobile phone market in conjunction with Vodafone to build up sales and a service department.


So far this year in the US $875 billion of M&A activity – up 9% on last year – have been transacted with the Time Warner/Chartered deal valued at $50 billion and the Kraft/HJ Heinz deal at $49 billion being the largest. June could be the biggest month of all time! 54% of US CEOS contacted think they will be involved in an M&A deal this year.


David Buik – market commentator


Panmure Gordon & Co


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