TODAY’S FAYRE

TODAY’S FAYRE – Monday 3rd August 2015

 

“Between us now and here –

   Two thrown together Who are not wont to wear    

Life’s flushest feather – Who see the scenes slide past,

The daytimes dimming fast, Let there be truth at last,    

Even if despair.

 

So thoroughly and long    Have you now known me,

So real in faith and strong    Have I now shown me,

That nothing needs disguise Further in any wise,

Or asks or justifies    A guarded tongue.

 

Face unto face, then, say,    

Eyes mine own meeting, Is your heart far away,    

Or with mine beating? When false things are brought low,

And swift things have grown slow,

Feigning like froth shall go,    

Faith be for aye.”

 

 

Thomas Hardy – author & poet – 1840 –1928

 

I am all for charity! Yes, I am certainly very supportive of protecting cyclists from fatal collisions particularly accidents and potentially fatal ones with lorries! However there needs to be a two-way conversation on transport etiquette! I think people forget that roads were built for cars, with a view to accommodating cyclists with care and due deference. However today there are an increasing number of cyclist that aim their bicycles lawlessly, as missiles without care or respect for motorists or pedestrians, rather than ride them with consideration. One of the problems is that these bikes are high performing vehicles, encouraging speed and outrageous behaviour!

 

Hence I personally resent having London inconveniently closed off for the day every year! Why can’t these cyclists alternate their jamboree and celebrations with Birmingham, Manchester, Glasgow and maybe Bristol? Surely the inhabitants of these wonderful cities are equally entitled to see or participate in one of the most popular of pastimes, rather than London being gridlocked for a weekend!

 

So Richard Hughes will be parking his saddle in the weighing room – a great loss but what a fantastic addition to the training ranks for one of the most delightful and articulate of racing acolytes. He will be a huge unqualified success. There may have been no winner on his final day as a jockey at Goodwood, but no jockey over the years has ever ridden this tricky course better. However hats off to Frankie Dettori for the superb ride he gave ‘Magical Memory’ to win the Steward’s Cup.

 

The effervescent Cilla Black – 72 years old! That’s too young! The most fabulous singer – ‘Alfie’ and ‘Anyone who had a heart!’ for starters and let’s not forget what an amazing entertainer and wit she was! RIP!

 

Just a few notes on banks this morning. The RBS sale looks like it will be getting under way sooner rather than later – maybe this week or next. We were given notice by Chancellor Osborne in the Budget. With advice from NM Rothschild it looks as though the first tranche – 6% valued at £2.5 billion may come under the hammer and be sold to institutional investors at circa 342p – way below breakeven of 502p. However the Chancellor and his advisors tell us that we will not regret it. Not only is it good for the UK economy to get the debt down but investors by showing pluck and imagination will be rewarded in the long term – well maybe in heaven if not in their respective pockets! I have my doubts as there is going to be banking indigestion and I am less than convinced that RBS’S problems are either over or out of remission. Morgan Stanley has done a brilliant job of dribbling out Lloyds stocks taking the taxpayers’ stake down to 14.98%. However the £48 billion RBS liability is a different kettle of fish altogether. Lloyds Banking Group’s balance sheet is in relatively good shape, but though RBS’s balance sheet has been virtually halved; nonetheless the bank looks a bit like a one trick retail bank pony. There is little there to titivate the taste buds ahead of other investment opportunities – media, telecoms and drugs for openers.

 

HSBC’s results were posted at 5.00am this morning. Profits before tax were up 10% at $1.68 billion against expectations of $12.5 billion. Revenues were up 4%. Return on equity was 10.6%. HSBC confirmed that the realignment of its business was underway. Its Brazilian Operation had been sold to Banco Brandisco for $5.2 billion and there were more disposals to go in Turkey, Africa and the Middle East. The balance sheet may be cut by $300 billion. There is little doubt that HK and China made the greatest contribution to profits. As the UK is only responsible for 20% of HSBC’s business, on balance it looks as though Chancellor Osborne has not ‘floated’ Stuart Gulliver’s boat sufficiently with concessions on issues such as the bank levy and the new tax to be introduced to encourage HSBC to keep its head office in the UK. It may be that there is no official announcement will be made before the end of the Year, but the runes in the sand do not look encouraging for the government. I expect HSBC to IPO its UK operation as maybe Midland Bank next year and head East with the swag!

 

UK companies posting results this week – Monday – HSBC (5.00am), INTERTEK, TRINITY MIRROR, FIDESSA, Tuesday – DIRECT LINE, SDL, TRAVIS PERKINS, JUST EAT, MEGGITT, STANDARD LIFE, FRESNILLIO, Wednesday – LSE, UNITE, STANDARD CHARTERED BANK, L&G, Thursday – AGGREKO, OLD MUTUAL! AVIVA, MONDI, RANDGOLD, RSA, INMARSAT, SPIRENT COMMUNICATIONS, ENTERPRISE INNS, MYLAN, SAB MILLER (TS), Friday – WILLIAM HILL, BELLWAY.

U.S. Companies posting interim results this week – Monday – LOEW’S, BROADCOM, Tuesday – AETNA, SPRINT, BEAZER HOMES, KELLOGG, MGM RESORTS, LIBERTY GLOBAL, EASTMAN KODAK, Wednesday – TIME WARNER, RALPH LAUREN, MOTOROLA SOLUTIONS, TESLA, Thursday – FRED’S, ALLERGAN, VIACOM, ZYNGA, Friday – SOTHEBY’S, HERSHEY

Economic data – Monday – UK MANUFACTURING, Tuesday – UK PMI CONSTRUCTION, UK PMI SERVICES, Thursday – BOE MPC INFLATION REPORT – Friday – US NON- FARM PAYROLLS

 

 

 

David Buik – market commentator

 

 

Panmure Gordon & Co

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