TODAY’S FAYRE – Tuesday 30th June 2015


“WHEN we two parted

In silence and tears,

Half broken-hearted

To sever for years,

Pale grew thy cheek and cold,

Colder thy kiss;

Truly that hour foretold Sorrow to this.


The dew of the morning

Sunk chill on my brow–

It felt like the warning

Of what I feel now.

Thy vows are all broken,

And light is thy fame:

I hear thy name spoken,

And share in its shame.


They name thee before me,

A knell to mine ear;

A shudder comes o’er me–

Why wert thou so dear?

They know not I knew thee,

Who knew thee too well:

Lond, long shall I rue thee,

Too deeply to tell.


I secret we met–

I silence I grieve,

That thy heart could forget,

Thy spirit deceive.

If I should meet thee

After long years, How should I greet thee?

With silence and tears.”


George Gordon, Lord Byron – poet – 1788-1824

As an international sporting show piece, Wimbledon seems to get more high-profile and grander as the years roll by. And how the behavioural patterns have changed as well – very much for the good!  It was great seeing so many fanatical Australians cheering on their former talisman Lleyton Hewitt in a five set thriller on Court 2 – sadly to no avail – in his first round defeat against the Finn, Neimenen! Seventeen years Hewitt has played at Wimbledon and it was thirteen years ago that he was champion – a record to be immensely proud of!


Investors’ reaction to equity markets was utterly predictable. Compile indecision, uncertainty and political incompetence together and it makes a lethal cocktail – tailor made for a measurable market correction. Observers and bystanders were not disappointed. The FTSE, least affected by gross EU/IMF ineptitude, eased by 1.97%. An hour before the close it was less than 1% down, but the power and influence from the Street of Dreams was too much – down it came! The DAX fell out of bed by 3.5% and the CAC by 3.7%. Greek Exchange remained closed and will probably remain so until after the referendum next Monday. The Street of Dreams also vented its spleen at the Greek crisis, as well as concerning itself with Shanghai Composite’s 6% drop yesterday, frothy valuations of US stocks and the threat of higher interest rates. The DOW closed down 1.95%, the S&P 500 by 2.09% and the NASDAQ by 2.40%. It is a worrying factor that the Shanghai Composite has lost over 20% in two weeks, which ventured to suggest that the authorities do not have a proper handle on monetary and fiscal policy. However this morning it has had a massive turnaround from -3% in the morning to +4.95% at lunch! The Nikkei closed up 0.63% this morning.


Who know what will happen at the referendum next Monday? Even if Greece votes to stay in and Tsipras is forced to resign, austerity will return to the agenda; so nothing changes. Greece with only 11 million and little industry or commerce can never service or repay €240 billion of debt – so long as night follows day! The problem is never going to go away. So we continue to reel from one crisis to another. The EU’s credibility has never been lower and it is fair to say that Tsipras has been duplicitous in the extreme. I may be dribbling from the corner of my mouth and walking on a Zimmer frame by the time Greece exits the EU, but it will happen!


Much as I admire George Osborne as Chancellor – I think he has done really well, he gave me a dose of the ‘pip’ yesterday by putting the fear of God into investors in warning of serious ramifications from a Greek GREXIT. Yes, I understand contagion, but if UK banks off their own bat or with the help of the BOE have not made contingency plans as to their holding of Greek assets and loans in the past couple of years, then I have scant sympathy for them. Yes, George Osborne has a Budget to present next Wednesday with £12 billion of welfare cuts for the electorate to swallow. However, if Greece is as serious a threat to the UK economy, as the Chancellor suggests it might be, then we have a real problem. The UK thrashed the EU, when it came to growth in recent years; no reason why we cannot keep trucking. I think I understand being political savvy and prudence, but being unnecessarily negative about prospects of economic situations can be very dangerous.


Yesterday Consumer Confidence was confirmed to be at its highest level in the UK since the 1990s. Carolyn Fairbairn will succeed John Cridland as CBI director General. M/S Fairbairn started life off as an economist at the World Bank and has since enjoyed successful sojourns as director of strategy at the BBC and ITV. We wish her well. Ladbrokes’ CEO Jim Mullen confirmed that merger talks with Coral Gala were still on-going. The joint company will have 4,000 betting shops out of 9,000. This will be a competition issue, which will require some thought as to what shops are sold or closed down.


This morning there were encouraging results from Ocado, Carpetwright, Northgate and Imagination Technology. After hours in Tokyo, Sony’s shares fell 8% after an announcement that $3.65 billion of fresh capital was required. With the advent of the ipad, iphone, lap-top, Sony has been caught napping, despite producing the finest televisions over the past 30 years.



US Company results – Wednesday – CONSTELLATION BRANDS, FORD MOTOR (sales) – Thursday. – RITE AID CORPORATION.

Global economic diary – Monday – UK Consumer confidence, Wednesday – BOE Financial Stability report – Thursday -US NON-FARM PAYROLLS (+2015k) rate 5.5%, Friday -US INDEPENDENCE DAY NEW YORK markets closed.

David Buik – market commentator

Panmure Gordon & Co


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