TODAY’S FAYRE – Tuesday 21st July 2015
“O Captain! my Captain! our fearful trip is done;
The ship has weather’d every rack, the prize we sought is won;
The port is near, the bells I hear, the people all exulting,
While follow eyes the steady keel, the vessel grim and daring:
But O heart! heart! heart! O the bleeding drops of red,
Where on the deck my Captain lies, Fallen cold and dead.
O Captain! my Captain! rise up and hear the bells;
Rise up–for you the flag is flung–for you the bugle trills;
For you bouquets and ribbon’d wreaths–for you the shores a-crowding;
For you they call, the swaying mass, their eager faces turning;
Here Captain! dear father! This arm beneath your head; I
t is some dream that on the deck, You’ve fallen cold and dead.
My Captain does not answer, his lips are pale and still;
My father does not feel my arm, he has no pulse nor will;
The ship is anchor’d safe and sound, its voyage closed and done;
From fearful trip, the victor ship, comes in with object won;
Exult, O shores, and ring, O bells! But I, with mournful tread,
Walk the deck my Captain lies, Fallen cold and dead.”
Walt Whitman – poet – 1819-1892
Against my better judgement I went to see the controversial and much heralded documentary on Amy Winehouse – “AMY” – directed by Asif Kapadia, who made that brilliant film – “SENNA.” Amy Winehouse’s music is, as you might imagine, was not my bag at all. However this amazing reconstruction of her life in this film, warts and all – the drugs, sex, rock ‘n roll, depression and vulnerability certainly helped to illustrated her breath-taking talent, whilst at the same time these antics were destroying her. Amy had an extraordinary voice with a wide-ranging style of songs, most of which she wrote. From the evidence portrayed by the film, her Father Mitch and husband Blake Fielder have much to answer for. Her father clearly exploited her commercially without displaying any sensitivity towards her vulnerability. As for Mr Fielder, despite protestations to the contrary he enjoyed the ride he shared with her into ‘cocaine Elysium!’ What a tragedy and a waste of a young life! Amy died aged just 27!
Greece almost took a back seat yesterday in terms of financial headline domination. Banks re-opened in Greece and Greece repaid €2.05 billion to the IMF as scheduled and €1.45 billion to the ECB. That is by no means the end of the drama, which will continue to unfold in the months to come. However there were other matters that captured investors’ imagination. Top of the list would be gold and its recent fall from grace. The threat of higher interest rates in the US, the very strong Dollar and China’s diminished appetite has precipitated a 33% fall in the price of gold in recent months since 2012 to $1102 an ounce and a 42% fall since its all-time high $1900 in 20010. It is interesting to note that China’s gold reserves have been bolstered by 57% in the past months.
Falling gold prices took the gilt of the ginger bread on the Street of Dreams yesterday with Barrick Gold falling by 16% at one time and Newmont Mining by 12%. Randgold in the UK also had a torrid time easing by 4%. Anglo-American only fell 0.6% this morning but this company has proved very disappointing investment in the last year down from 1650p to 862p and down from 3300p in 2011 – hardly surprising with such a steep drop in mineral prices. Morgan Stanley posted decent numbers with revenues up 13%. Conversely IBM (Old Blue), though it posted better than expected earnings, revenues and sales for the last quarter fell 13%. IBM’S shares fell by 4%. Lockheed Martin is expected to complete the purchase of Sikorsky Helicopters for $9 billion. The DOW & S&P 500 were both up 0.8%, when the bell was wrung and the NASDAQ closed up 0.17%.
All eyes will be on Apple’s results after hours. Analysts are expecting 47 million iPhones to have been sold, with sales in China expected to be responsible for 29% of a 32% increase in sales for the third quarter, generating an estimated $49.3 billion of revenue. Apple’s shares have added 40% in value in the last year.
There was a temporary sense of relief yesterday in Europe; so the performance of its bourses was mixed – some still bouncing out of the ‘Doldrums’, with the FTSE 100 suffering from a little bit from falls in mineral and commodity prices and some holiday inertia – up just 13 points at 6788. Barclays’ shares did not respond to the likelihood that 30k redundancies may be made in the next couple of years. We also wait with bated breath on management changes implemented at Standard Chartered by Bill Winters. Will Mike Rees survive? This morning we had a slew of earnings – but no ‘Big Berthas!’ Royal Mail posted a bland trading statement. Though European volumes were up 8%, it may be that the falling value of the Euro could wipe much of those gains out. PZ Cussons’s efforts were nothing to write home about and though AO World’s shares rallied 9.6% thanks to UK sales being up 6.5 per cent, while orders were up 13.9 per cent for the three months to 30 June. There may be an element of a ‘dead cat bounce’ in that price. The stock has been heavily shorted! IG Group saw revenues up 8% but was still suffering at the hands of the Swiss Central Bank’s unexpected ‘Exocet missile!’ CEO Tim Howkins will be leaving and Peter Hetherington, the COO will assume charge until a replacement has been appointed. Yesterday Pearson’s shares popped 5% on rumours that the FT together with 50% of the Economist might be for sale for about £1.1 billion. If that price includes pension costs, that valuation may be a tad rich, according to Panmure’s Jonathan Helliwell.
UK companies posting results this week – Monday – Wednesday – FENNER, JOHNSON MATTHEY, MARSTON’S, PAYPOINT, SAGE, LAND SECURITIES, SHIRE PHARMACEUTICALS, EASYJET, ARM HOLDINGS, Thursday – DMGT, UNILEVER, DE LA RUE, PREMIER FOODS, BRITVIC, SAB MILLER, KINGFISHER, ABERDEEN ASSET MANAGEMENT, HALMA, Friday – ANGLO-AMERICAN, AG BARR, LONMIN, VODAFONE, CLOSE BROTHERS
US Companies posting interim results this week – Monday – Tuesday – BANK OF NEW YORK MELLON, UNITED TECHNOLOGIES, LOCKHEED MARTIN, OMNICOM, HARLEY-DAVIDSON, BAKER HUGHES, APPLE, MICROSOFT, YAHOO!, Wednesday – WHIRLPOOL, COCA-COLA, BOEING, ABBOTT LABS, XILINX, AMERICAN EXPRESS, Thursday – GENERAL MOTORS, RAYTHEON, BOSTON SCIENTIFIC, BRISTOL MYERS SQUIBB, MCDONALD’S, PULTE, KKR, COMCAST, AT&T, BJ RESTAURANTS, CHUBB, AMAZON, VISA, STARBUCKS, Friday – ABBVIE, BIOGEN.
Economic data – Monday – UK bank lending, UK Public Sector Finances, Wednesday – BOE Minutes, Thursday – UK Retail Sales
David Buik – market commentator
Panmure Gordon & Co
David Buik – market commentator
Panmure Gordon & Co