Monthly Archives: December 2015


TODAY’S FAYRE – Tuesday, 29th December 2015


Looking up at the stars, I know quite well

That, for all they care, I can go to hell,

But on earth indifference is the least

We have to dread from man or beast. 


How should we like it were stars to burn

With a passion for us we could not return?

If equal affection cannot be,

Let the more loving one be me.


Admirer as I think I am

Of stars that do not give a damn,

I cannot, now I see them, say

I missed one terribly all day.


Were all stars to disappear or die,

I should learn to look at an empty sky

And feel its total dark sublime,

Though this might take me a little time.”



WH Auden – poet – 1907-1973


I was given the most wonderful DVD for Christmas – “I believe in Miracles.” It’s the documentary on how Brian Clough, aided and abetted by his assistant Peter Taylor put Nottingham Forest back on the map as a serious football club, back in the late ‘70s. For football fanatics these revelations are a nostalgic must. Forest were languishing mid-table in the 2nd division. Brian Clough and Peter Taylor, after great success at Derby County followed by short ignominious stints at Brighton and Leeds United, galvanised this team with shrewd buys and instilling belief and team spirit, drove Forest out of the 2nd division in 1977 to win the First Division Championship in 1978 and the European Cup in 1979 and again in 1980.


Peter Shilton, Viv Anderson, Frank Clarke, Colin Barratt, David Needham, John McGovern, Larry Lloyd, Ken Burns, Ian Bowyer, John Robertson, Tony Woodcock, Trevor Francis, Gary Birtles, Archie Gemmell, John O’Hare and Martin O’Neill are all names to conjure with. Their success could only be described as modern-day fairy tale. The different qualities required 35 years ago to win multiple cups and competitions and those of today bear little resemblance. Brian Clough sadly passed away in 2004 after a liver transplant followed by cancer aged 69. What a man? He may have been called ‘Bug Head!’ but what an achiever!


Boxing Day’s King George, won by ‘Cue Card’ on the nod from Mullins/Ricci’s ‘Vautour’, who probably did not stay, suggests we may not have seen the winner of the Gold Cup yet. ‘Don Cossack’ fell (he needs better ground) and two strong Irish contenders wait in the wings – ‘Road to Riches’, ‘Don Poli’ andDjakadam’, not forgetting last year’s English bred and trained the brilliant ‘Coneygree’


The ‘Santa rally’ to me is out of all proportion. Large oil companies and a coteries of mining stocks, savagely trashed throughout the year have been the main component beneficiaries of the recent surge in their respective share prices – Shell, BP, Anglo, Glencore, BHP Billiton and Rio to mention the main dramatis personae. Technology, drugs and banks have also made measurable gains. My shrewd colleague, Paul Modlock flagged up Standard Chartered Bank as a stock to lump on and how right he has been – up over 10% in the last 3 weeks. One suspects that if Bill Winters, this banking titan’s CEO has been visceral enough in making management changes, there will certainly be more to come. As examples, since 12th December 2015, provided today forecasted gains don’t run out of steam the FTSE 100 has rallied by 6.62%, the DAX by 4.91% and the DOW by a rather muted and realistic 1.18%.


We have heard the likes of BBC’S Joe Lynam consistently extol the virtues of gargantuan sales on the high street before and after Christmas. Many have posted record levels of activity. However the market and many bear traders have remained cynical, keeping many of the ‘shorts’ on until the main retail operators post trading statements in the first 2 weeks of 2016. Why? There is no food or clothes inflation, thus forcing many of the top brand names to go to war with unrealistically large discounts to shift stock. The high street has had 50% discounts on offer for a month. The consumer has become very savvy and is now always looking for the next bargain. In the first week of 2016 the market will be updated by NEXT, John Lewis, Poundland and M&S. The following week AB Foods (Primark), Burberry, Mothercare and Home Retail step up to the plate. Then there are the efforts over Christmas of Tesco (14th January), Sainsbury (13th January) and Morrison (12th January) to consider. It is interesting to note that following in the wake of Warren Buffett divesting Berkshire Hathaway from its investment in Tesco, Norway’s pension fund recently sold 27 million shares in The UK’S largest supermarket, taking its stake below 6%. 


There is such respect for Lord Wolfson and NEXT, that this retail emporium may well escape vituperative treatment, but one would be less than confident that Burberry, Poundland, Mothercare or Home Retail would be immune from the wrath of hedge funds if their efforts do not pass muster. 


The uncertainty of interest rate movements, the EU Referendum and the outcome of the General Election accounted for the fact that the IPO market and M&A activity has been very patchy, though some really decent deals did manifest themselves. Though there is still the likelihood that Shell will bed down with BG and that Astra, GSK and Shire could be either on the acquisition trail or be under attack from other predators. Expect media and mobiles to be knocking at the door of opportunity. Also many splendid SMES may well provide the best hunting grounds for corporate activity. There are high expectations that Clydesdale, Yorkshire Bank, Metro Bank, Vue Cinemas, United Biscuits, First Utility and Brakes will be brought to the sacrificial altar of initial public offerings. I was mildly amused that ITV denied all knowledge of having had its lapels tugged by Comcast. 


We welcomed Worldpay, Provident Financial and DCC in to the FTSE 100 last week and bid a fond ‘sayonara’ to Wm Morrisom, Meggitt and G4S.The fact that the US only produced a 2% increase on an annualised basis in 4th quarter GDP (down from 2.1%) just before Christmas went almost unnoticed. Investors were surprisingly unconcerned. However here in Old Blighty there were a few cocked eyebrows at the rather indifferent performance of 3rd quarter UK GDP with postings of 0.4%. As the EU referendum muscles its way towards the top of the UK political agenda, the marginally lack-lustre indecisiveness of the outcome may be more damaging for the UK’s economy than many think.


David Buik


Market Commentator – Panmure Gordon & Co


2015 was not as scripted and I doubt 2016 will be either!

Monday, 21st December 2015


“’Twas the night before Christmas, when all through the house

Not a creature was stirring, not even a mouse;

The stockings were hung by the chimney with care,

In hopes that St. Nicholas soon would be there;

The children were nestled all snug in their beds,

While visions of sugar-plums danced in their heads;

And mamma in her ‘kerchief, and I in my cap,

Had just settled down for a long winter’s nap,

When out on the lawn there arose such a clatter,

I sprang from the bed to see what was the matter.


Away to the window I flew like a flash,

Tore open the shutters and threw up the sash.

The moon on the breast of the new-fallen snow

Gave the lustre of mid-day to objects below,

When, what to my wondering eyes should appear,

But a miniature sleigh, and eight tiny reindeer,

With a little old driver, so lively and quick,

I knew in a moment it must be St. Nick.


More rapid than eagles his coursers they came,

And he whistled, and shouted, and called them by name;

“Now, DASHER! now, DANCER! now, PRANCER and VIXEN!


To the top of the porch! to the top of the wall!

Now dash away! dash away! dash away all!”

As dry leaves that before the wild hurricane fly,

When they meet with an obstacle, mount to the sky,

So up to the house-top the coursers they flew,

With the sleigh full of toys, and St. Nicholas too.

And then, in a twinkling, I heard on the roof

The prancing and pawing of each little hoof.


As I drew in my hand, and was turning around,

Down the chimney St. Nicholas came with a bound.

He was dressed all in fur, from his head to his foot,

And his clothes were all tarnished with ashes and soot;

A bundle of toys he had flung on his back,

And he looked like a peddler just opening his pack.

His eyes — how they twinkled! his dimples how merry!

His cheeks were like roses, his nose like a cherry!

His droll little mouth was drawn up like a bow,

And the beard of his chin was as white as the snow;

The stump of a pipe he held tight in his teeth,

And the smoke it encircled his head like a wreath;

He had a broad face and a little round belly,

That shook, when he laughed like a bowlful of jelly.


He was chubby and plump, a right jolly old elf,

And I laughed when I saw him, in spite of myself;

A wink of his eye and a twist of his head,

Soon gave me to know I had nothing to dread;

He spoke not a word, but went straight to his work,

And filled all the stockings; then turned with a jerk,

And laying his finger aside of his nose,

And giving a nod, up the chimney he rose;

He sprang to his sleigh, to his team gave a whistle,

And away they all flew like the down of a thistle.

But I heard him exclaim, ere he drove out of sight,



Clement Clarke Moore – poet – 1779-1863


As 2015 dawned investors’ hopes and aspirations seemed unlimited – None more so than in the UK? Growth in the US and UK looked very positive: the EU’s PR machine worked overtime in Frankfurt and Brussels, with Merkel et all extolling the virtues of the EU’s recovery, with the ECB’S printing press ready to roll if required. The Shanghai Composite was particularly vibrant, but the party ended in June 2015 – though 150% up in a year! The fact that China’s economy was visibly coming off the boil was conveniently ignored – the ‘ostrich syndrome’; if we don’t worry about it too much, it will go away!


At much the same time Nikkei punters were being egged on by a weaker Yen, thanks to the FED teasing the market with the threat of higher rates for months on end. Then there was Abenomics, which looked like arrant nonsense to many, but was certainly potent enough to get Japanese investors wound up. There are more than just a few who nap the Nikkei to be a star performer in 2015. I wish them well. The Hang Seng was, of course, for much of the year, a very accurate barometer of market confidence. Also Australia’s ASX was geared to the success of minerals and mining stocks. 


Set out below is a table of the performances of the major indices. I will make general comment but much of this missive will be focusing on the UK.

INDEX 31/12/14 18/12/15 % rise/fall
FTSE 6566 6052 -7.8%
DAX 9805 10608 +8.2%
CAC 4416 4625 +4.7%
DOW 17823 17128 -3.9%
S&P500 2080 2005 -3,6%
NASDAQ 4736 4923 +3.9%
NIKKEI 17450 18986 +8.8%
HANG SENG 23605 21755 -7.8%
ASX 5411 5106 -5.6%
Shanghai Comp 3235 3579 +10.6%

Here in the UK we started 2015 full of aspirations with a bit of ‘sound and fury!’  However an understandable correction waited in the wings in the early weeks of 2015 when oil dropped from $65 a barrel to $52.  But then the FTSE 100, on reasonable earnings and no logical alternative asset class competition ploughed its way to a record 7104 at the end of April.  But it never had the legs or the conviction to push on.

Soon warning bells in the shape of distress signals affecting growth in China that threatened a meltdown.  Oil prices continued to fall sharply; that rattled the market’s confidence. Add to that ridiculous drawn-out unsubstantiated threats from the FED to raise interest rates, after 9 years, which made for a very strong dollar, thus trashing emerging markets that brought about a change in sentiment and the cocktail for investors was becoming quite heady and almost toxic.  Investors suddenly realised that stock markets were not delivering growth, thus triggering a fall in the FTSE 100 to 5900 in August. Unfortunately the surprising result of the General Election was only of temporary impetus value for equities, however positively business perceived the election of the Tories with an overall majority perceived it to be.

Clearly share buy backs, lower dividends and willingly conceived gargantuan M&A activity to penetrate wider markets helped exacerbate the retrenchment of equities in September and October. This was followed by a dramatic cut in resource prices – iron ore, nickel, and copper and to a lesser degree gold, which helped larrup the mining sector – down average of over 50% in 2015. Without heady M&A activity, many believe equities would have fallen much more than they did. How Astra Zeneca did not bite Pfizer’s hand with US drug titan’s £55 a share bid remains a mystery and as for Shire being forced to resist Abbvie overtures thanks to Obama was unfortunate. Both US companies were paying Top Dollar.

After September’s recovery to 6500, we have seen the market drift on the back of oil dropping to $40 a barrel, and mining stocks falling off a precipice. Add very average growth, diluted dividends and almost certainly a FED rate, which eventually transpired last week and this provided a compelling argument to lighten up portfolios – Here we are at 6000.


What else dramatically affected the performance of global equity markets? Dealing with China, markets never quite knew where they were with the authorities. They threw the kitchen sink at their problems using currency manipulation, banks to provide liquidity and brokers to massage the stocks market when it fell about 70% in double quick order – sadly not very affective. No one knew how economical the Chinese government was being with the truth. This regrouping was more than just a re-adjustment. It was swingeing. The general consensus is that the worst period for decline in growth took place in the first quarter.


Markets have failed to embrace ‘forward guidance’ either in the US or the UK and there is little doubt that M/S Yellen’s FED’s prevarication over hiking rates did irreparable damage to emerging markets and regularly prevented orderly markets prevailing. Thank God the FED finally got its act together last week, though frankly the fundamentals have not changed in terms of cautious sentiment towards equities globally. I am a fan of the BOE. The Bank of England has tightened up regulation well, significantly and justifiably. Most would salute Mark Carney Andrew Bailey. Minouche Shafik and Sir Jon Cunliffe. However there are few fans of ‘forward guidance’ here in the UK. This facility has been a hindrance rather than a help. Frankly it has added to confusion and volatility this year. Equities required little added encouragement to behave either violently or irrationally. The increasingly enormous influence brought to bear by technology and programme trading on the main bourses now constitutes over 40% of volumes. So confusion is already there in abundance without added distractions such as ‘forward guidance.’


The P/E ratios of the FTSE 100 and S&P 500, just as examples at 15X and 18X respectively were starting to look quite rich in terms of being fully valued. Without so many major deals in terms of M&A activity, which have totalled globally $3.24 trillion in 2015, I suspect equity markets would be lower in terms of value. With no inflation, creating profit margins has been tough; therefore the need to penetrate wider markets by way of acquisition, has been paramount. The US has been the standard bearer with huge deals involving Charter/Time Warner, Pfizer/Allergan, Dell/EMC, GE/Alstom, Heinz/Kraft, Anthem/Cigna and Dow Chemical/DuPont for openers. Here in Old Blighty Shell/BG is testing shareholders to their limits and BT/EE was in its own field a £12 billion coup.


In terms of individual performances in the UK, mining was a real drainer – the sector down by 60% with Anglo-American down 75%. Banks continued to court adverse publicity in terms of PPI, LIBOR and FX transgressions involving billions of pounds worth of fines and retribution, let alone the cost of fresh capital. RBS is down 23%, HSBC is 10% light and even though the taxpayer owns less than 10% of Lloyds Banking Group, it shares are easier by 5.6%. Tesco’s year has been one to forget – down 28% with Morrison down 16%. The bright spots of the bigger ‘cap’ stocks have been Hargreaves Lansdown in its first year in the FTSE 100 – up 46%, from the FTSE 250 Betfair up 156%. It is interesting to note that the FTSE 250 as an index is still above the Plimsoll line this year – up 6.9%. The outlook for 2016 suggests that stock picking will be the name of the game. In other words companies that have growth potential. The health and media sectors are perhaps those with scope. Ryanair has been a great little ‘Arfur Daley’ – up 48%. The reason for the DAX and CAC remaining above the Plimsoll line was the introduction of QE by the ECB in March of this year.


The Panmure ‘Conviction’ list for 2015 did fairly well but I will leave their analysts to present their credentials with their offerings for next year. There is valuation out there but stock selection for growth will be key! Those that know a great deal more than I do are also very upbeat about European equities in 2016! We shall see!


Merry Christmas and a prosperous New Year!


David Buik


Market Commentator – Panmure Gordon & Co

TODAY’S FAYRE – from Hall to Luther to the FED to markets

TODAY’S FAYRE – Thursday, 17th December 2015


“Safe in their alabaster chambers,

Untouched by morning and untouched by noon,

Sleep the meek members of the resurrection,

Rafter of satin, and roof of stone.


Light laughs the breeze in her castle of sunshine;

Babbles the bee in a stolid ear;

Pipe the sweet birds in ignorant cadences, —

Ah, what sagacity perished here!


Grand go the years in the crescent above them;

Worlds scoop their arcs, and firmaments row,

Diadems drop and Doges surrender,

Soundless as dots on a disk of snow.”


Emily Dickinson – poet – 1830-1886


As an avid listener to BBC’s ‘Sports Report’ on ‘5-live’ since the days when Eamonn Andrews first hosted the programme at 5 O’clock on a Saturday night back in the early 50’s, no programme would ever have been complete without a Stuart Hall poetic and literary report on some very average and nondescript game in the North West such as Bolton Wanderers and Blackburn Rovers.  I have never known a match reporter bring a game to life in the manner Hall did.


However setting that aside, I was absolutely outraged that Hall was released from prison yesterday after 2-years – half his sentence – for sexual crimes against girls of very tender years.  I know Hall will be 86 next week and is no longer a threat or danger to society, but he needed to fully pay for those iniquitous crimes!


‘Luther’ – Idris Elba is back with a vengeance as the sardonic detective – riveting viewing! Elba has so much presence and aura about him. In fact I have started to watch ‘The Wire’ again. Extraordinary that both Idris Elba and Dominic West both started to hit the ‘high spots’ as actors in this Baltimore based detective series.


Are these the final days of the second ‘Mourinho Dynasty’? It’s hard to believe that 5 months ago Chelsea FC were at the pinnacle of football society.


So the ‘day of reckoning’ arrived and bless her cotton socks, FED Chairman Yellen didn’t ‘bottle it’ and she delivered the 25 basis point increase in the FED rate – the first adjustment since 29th June 2006. Mind you, God help the markets had she not done so! It is not even worth contemplating. It was also reassuring that there were no dissenting voices in the camp. The vote was unanimous. I would admit to being not the brightest pin in the box, but for over 25 years I have battled with ‘FED geek talk’ from Greenspan to Bernanke to Yellen, in an attempt to decipher the content of FED statements and minutes. Progress has been painfully slow. Anyway in the tea leaves this time I read that any further increases will be measured and probably slow. M/S Yellen is insistent on avoiding any violent reaction to changes in the fortunes of the US economy – both positive and negative. So all being well there may be a further four 25 basis point hikes in 2016 and a further 1% in 2017. The FED’s goal is 3.5% by about 2020. She won’t get there, but those are her best laid plans. The FED is adopting a tightening policy, whereas everyone else, with the exception of the UK, is easing with aggression.



Just to bang the final nail in the coffin, I am over ‘forward guidance.’ With so many economic and political imponderables, we are heading in to ‘Hans Christian Anderson’ fairy tale land. Finally what is interesting is the fact that since the Fed’s GDP forecast was increased 10bp to 2.4% for 2016, while staying unchanged in 2017 at 2.2% and 2% in 2018, we can make the argument that for every unit the Fed funds rate rises, the US economy is achieving a higher rate of growth. In other words, the economy is working harder for less! Apart from employment data greater credence and importance will be attached to inflation and wage inflation in deciding any further moves in interest rates.


What really mattered was the reaction of the Street of Dreams. Dealers embraced the FED’s cautious approach and consequently all three markets selected another gear. The DOW added 1.28%, the S&P 500 1.45% and the NASDAQ eclipsed the other two by grabbing average gains of 1.52%. Gains were made across the spectrum with even energy stocks enjoying the relief rally. Let punters enjoy the Santa Rally. Nothing has changed. We are still seeing to many buy backs with AIG announcing a $3 billion initiative and GE will hand back $26 billion through dividends and stock repurchases in 2016 as the company rewards shareholders after tilting the business back toward manufacturing and away from finance. Punters are beginning to see through this ruse to deliver better shareholder value.



Keep an eye on Amazon. It is increasing its share of U.S. online spending during the holiday season, even as Wal-Mart Stores Inc., Target Corp. and other rivals seek to attract consumers with promotional sales and free deliveries. Amazon took in 39.3% of e-commerce spending from November 1st to December. 6th, up from 37.9% during the same period a year earlier, according to Slice Intelligence, which gathers data through e-mail receipts of 3.5 million shoppers.


After the FED announcement the Dollar strengthened against most major currencies. This will leave the market worrying about China’s stance in wanting to continue lowering the value of the Yuan. Not surprisingly Asia took a ride on Asia’s coattails, enjoying a relief rally. At the close the ASX was up a very encouraging 1.46% and the Nikkei +1.59%. At lunch the Shanghai Composite was up 1.81% and the Hang Seng was +0.73%.


FED expectations took the FTSE 100 comfortably above the 6000 threshold yesterday – up 43 points at 6061. The real move took place on Monday, but there is a feeling that Santa is making his presence felt. AstraZeneca confirmed that it agreed to buy a 55% stake in Acerta Pharma BV for $4 billion that will give the U.K. drugmaker a potential blockbuster medicine for blood cancers as well as diseases in which the body attacks itself. Shares were up 1.6% at the opening. There were good numbers from Dixons Carphone and SuperGroup. This morning the FTSE 100 opened up +93 at 6154. Banks +2%, mining, mining +2% and oil +1% led the charge. Purplebricks made a very somnolent start in its IPO on AIM. Shares were issued at 100p and were only up 0.5% in early skirmishes.


UK companies posting results this week – Thursday – Premier Farnell, Friday – Carnival, Trinity Mirror


US companies posting interim results this week – Thursday – Oracle, Red Hat, AAR, Friday – Lennar, Darden Restaurants 


David Buik


Market Commentator – Panmure Gordon & Co 



The following announcement was made by the CMA, concerning Williams & Glyn this morning

“The government is committed to achieving a strong and diverse banking sector to benefit UK customers. HM Treasury previously asked the Competition and Markets Authority (CMA) to assess the likely impact of the latest proposals for the divestment of Williams & Glyn for competition in the UK banking sector.

The divestment of Williams & Glyn represents a great opportunity to improve competition in banking, in particular in the small business banking sector. The divestment is another step in the government’s plan to improve competition in banking that gives real choice to retail and small business customers and supports the wider economy.

The Williams & Glyn business consists of 307 bank branches in the UK, including the RBS branches in England and Wales, and NatWest branches in Scotland. The government expects Williams & Glyn to be able to act as a strong competitive challenger to the incumbent banks.

RBS has told us that they have received informal approaches for the business, so they will now launch a trade sale process in H1 2016, and have told us that they will be able to complete the sale by end 2017. RBS are committed to divesting of W&G as soon as possible, in a way that ensures a smooth transition for customers and delivers value for taxpayers, within the mandated deadlines of the State aid agreement with the European Commission.

In light of RBS’s decision to launch a trade sale process, which would be likely to raise different issues from an IPO depending on the identity of a buyer and which would be subject to merger control as appropriate, we have asked the CMA to suspend its work on the review for now.”


When the banks hit the rocks in 2008, resulting in the Government taking RBS and Lloyds Banking Group in to public ownership, the EU in its infinite wisdom and majesty forced RBS/government to divest its self of 307 branches. Corsair was one of two interested parties that put a consortium bid together (49% owned by Corsair and the rest by RBS) that met the government’s criteria, which gave them the mandate to build W&G. Corsair, probably had more political clout thanks to Lord Mervyn Davies who fronted up the operation, rather than financial engineering prowess, which was the Higginson’s team’s métier. Prior to any IPO transpiring, the Cooperative Bank became the preferred buyer until it transpired that there was a £2.5 billion capital shortfall. Then Santander had a looked but decided against it.


For a couple of years RBS/Corsair has been going through the application process with the PRA. A consortium including Corsair Capital, Centerbridge Capital and the Church of England invested £600 million into the business in September 2013, in exchange for equity once the bank is floated in an IPO. RBS is required by the EU’s ruling to sell its full holding in the business by the end of 2017. Williams & Glyn will have approximately 250,000 small business customers, 1,200 medium business customers and 1.8 million personal banking customers.


A couple of months ago The Sunday Times claimed that Banco Sabadell, owners of TSB, was in the frame. I have reason to believe that that is quite wrong, as Sabadell has too much on its plate already with TSB. However there is definitely interest in challenger banks that have real traction from international investors. There is also talk of some of the challenger banks not making it and therefore being ripe for consolidation. W&G were looking for NEDs to help them with the Authorisation process as they were finding that the PRA were not rolling over because of the RBS connection.


I am staggered that it has taken seven years to be nowhere near close to bringing this painful transaction to a satisfactory conclusion. This is just a classic example why I absolutely abhor the idea of the EU interfering with the regulation of our banking system. The EU brings nothing to our party but confusion and irritation. The culture of UK banks as against EU banks is as different as chalk from cheese. A deal hiving off W&G or a regional part of the bank could easily have been done without EU’s size 12 hob-nailed boots.


TODAY’S FAYRE – Wednesday, 16th December 2015


“Whose woods these are I think I know.

His house is in the village, though;

He will not see me stopping here

To watch his woods fill up with snow.


My little horse must think it queer

To stop without a farmhouse near

Between the woods and frozen lake

The darkest evening of the year.


He gives his harness bells a shake

To ask if there is some mistake.

The only other sound’s the sweep

Of easy wind and downy flake.


The woods are lovely, dark, and deep,

But I have promises to keep,

And miles to go before I sleep,

And miles to go before I sleep.”


Robert Frost – poet – 1874-1963


I think it is only fair that I should be allowed to vent my spleen on certain passions I retain. One of those passions is Fulham FC.  I like to think that the owner, Shahid Khan, has just been every badly advised and misdirected by the managing director Alistair Macintosh and his useless cohorts in the last 2 years.  If someone does not take a grip of this club before too long it is heading for relegation yet again.  What a tragedy! The club has a great catchment area with a wonderful traditional ground in Craven Cottage and great fans.  Fulham has some good players but the team is rudderless and without leadership. Could someone step up to the plate please?


It looks as though Andy Murray has flip-flopped with Jessica Ennis-Hill as a very warm order to win SPOTY on Sunday night. However great an achievement winning the Davis Cup was, despite many major countries not competing, in terms of beating a world class field to win the Tour de France for a second time Chris Froome should be ‘nailed-on’ as SPOTY 2015. However it won’t happen as cycling is no longer vogue because of the drug syndrome. Froome will still get my vote!

“Today’s the day the Teddy Bears have their picnic – If you go down in the woods today, you’re sure of a big surprise!” – The FOMC decision tonight!


In terms of abrogation of responsibility and indecisiveness the FEDERAL RESERVE grabs the ‘yellow jersey’ unopposed in 2015. In terms of prevarication, Chairman Yelled and her board have been even less decisive than Hamlet was at Elsinore! So go to it, Madam, tonight and nail it! Lay the ghost to rest! If it turns out to be the wrong decision; so what! Reverse it! No harm done! The Strength of the Dollar has seen China’s PBOC manipulate the Yuan down 8 consecutive sessions!


On a less frivolous note, Panmure’s Chief economist, Simon French makes the following poignant comments – ‘In the event of a rate increase utilities and real estate (where gearing is most acute) are likely to sell off, whilst banks, healthcare and technology may benefit.’ There are far greater luminaries on the subject of the FED than me to comment with authority than me.



On Monday the daily turnover in New York was at its highest for three months. The FTSE 100 yesterday, on the face of it, had a terrific session and I wondered whether similar trading conditions had prevailed – not so. There were great volumes in oils, particularly BP (+2%), Shell (+2.6%) and Tallow (+6%). Miners were also active with Glencoe leading the charge (+3% having been up 6%). Old Mutual enjoyed the mild weather in adding 5%.  What surprised me was the performance of the supermarkets. Though Kantor’s appraisal was positive the news from Tesco was not exciting (sales down an average of 3% for 3 months to 5th December, Tesco shares rallied by 4.3%, Morrison by 4.2%, Sainsbury 5.2%, Coad just +0.59% and M&S 1.5%. Apart from that volumes were very average and there was more than just a hint of a ‘dead-cat-bounce’ in equities, despite of the fact the ECB was adding more stimulus packages, which took both the DAX and CAC up 3%.



In passing Prada shares took some stick with profits down 35% in the last trading period. It was interesting to note that possible predators are knocking at RBS and Corsair’s doors to buy Williams & Glyn Bank, which consists of 300 odd RBS branches which were originally headed in the abortive direction of the Cooperative Bank thanks to an EU edict. This bank employs 4,500 people and services 1.8 million customers including about 25k SMES. The price tag is purportedly £1.5 billion if it is decided that a sale is the preferable route rather than an IPO. The abortive merger between Schneider Electrical and Aveva saw the latter’s share price fall by 36% initially. I won’t waste your valuable time talking about UK inflation which rallied from -0.1% to +0.1% last month. Panmure’s Simon French has already provided the market with some great analysis. Comments made by Mark Carney suggest that the UK is not quite ready for a rate increase.



The Street of Dreams continued its renaissance thanks to expectations of a FED hike, a rally in oil and commodity prices – energy sector was up about 3%. The DOW was up 0.90%, the S&P 500 by 1.06% and the NASDAQ by 0.87%. Banks were also in demand with Goldman, JP Morgan, Citigroup and BOA all up between 2.5% and 3%. Ahead of the ‘Star Wars’ premier, Walt Disney was up 2.5%. The first weekend is expected to generate $30 million in receipts and the film plus ancillary products $2 billion in the months to come. It is interesting to note that in the US cinemas have become more popular with IMAX’s share price having rallied 26% in the last year. Apple’s shares were down 1.77% yesterday and at $110 a share it is way off its best level of $134 this year. iPhone sales are looking a little brittle, which is why some semiconductor shares have been found wanting – ARM holding.



On the back of the pick-up in New York and a rally in energy prices Asia enjoyed an exhilarating session – The ASX closed +2.42% and Nikkei 2.61%. Towards the close the Shanghai Composite was +0.17% and the Hang Seng +1.99%. The FTSE 100 opening was reflective despite good results from Dixon Carphone +3.2% and SuperGroup up 8.5% at 8.10am. Eyes down for a full house in Washington this evening.

UK companies posting results this week – Wednesday – Dixon Carphone, SuperGroup, Thursday -Premier Farnell, Friday – Carnival, Trinity Mirror


US companies posting interim results this week – Wednesday – Joy Global, Jabil Circuits, FedEx, Thursday – Oracle, Red Hat, AAR, Friday – Lennar, Darden Restaurants 


Economic Data – Wednesday – FOMC meeting, UK employment Thursday UK Retail sales


David Buik


Market Commentator – Panmure Gordon & Co 


TODAY’S FAYRE – Tuesday, 15th December 2015


“I have been one acquainted with the night.

I have walked out in rain — and back in rain.

I have outwalked the furthest city light.

I have looked down the saddest city lane.

I have passed by the watchman on his beat

And dropped my eyes, unwilling to explain.

I have stood still and stopped the sound of feet

When far away an interrupted cry

Came over houses from another street,

But not to call me back or say good-bye;

And further still at an unearthly height,

A luminary clock against the sky

Proclaimed the time was neither wrong nor right.

I have been one acquainted with the night.”


Robert Frost – poet – 1874-1963


I have to admire the general level of Euphoria over the Paris Climate Change Accord, though I must confess I don’t buy in to it myself. Yes every human being agrees that pollution must be cut. However the fact that the agreement is not legally binding has worrying connotations. Also the manner the world is supposed to arrive at adopting renewable alternatives is eye wateringly naïve. Finally the cost of implementing these changes will gargantuan and these ‘movers and shakers’ think this money will be just be plucked from the trees like ripe cherries! Wake up, folks, this is the REAL world we are talking about.


We can only hope that the political ‘wake-up’ call that took place in France at the weekend, leaving Le Pen’s NF party in third place in the local elections is replicated at the next US Presidential election. Is it unreasonable to ask that out of a population of 316 million the GOP cannot find one plausible candidate? I know it is early days, but surely the Republicans can do better than Donald Trump? The idea that Hillary Rodham Clinton should ride up Pennsylvania Avenue to The White House, unchallenged, to become the 45th President of the USA as well as being the first woman to hold that high office, is unthinkable.


There is nothing bogus about the mood in equity markets. It is downbeat and there seems to be very little on the horizon to rekindle its spirit, apart from fund managers being forced to buy tracker stocks at the end of the month, probably reluctantly. The FOMC starts its 2-day meeting today and if it does not implement a symbolic 25 basis point hike in the FED rate tomorrow then a degree of unnecessary volatility and uncertainty will exacerbate the downbeat mood with further equity falls.


Yesterday the FTSE dipped another 72 points to 5874 – that is down 10% on the year and 17% since 26th April 2015! Again it was banks, mining, oil and drugs that provided little in the way of appetising appeal for investors. The fact that Astra Zeneca may considering a bid for Acerta for $5 billion seemed to do little for its share price. Acerta’s leukaemia drug Acalabrutnib, which is not dissimilar to Abbvie’s and Johnson & Johnson’s Imbruvica, has great appeal, but this proposed acquisition is far from done. Monday morning’s headlines about the possibility of Rolls Royce’s submarine operation being nationalised for security reasons made grizzly reading. RR has made at least 4 profits warnings and many think that RR is vulnerable to a takeover. One can understand the government’s concern, but nationalisation is surely only an option. An alternative would be for this division to sit snugly in BAE Systems portfolio. When Shell bid for BG Group oil was $60 a barrel and Shell’s share price was 25% higher at £20 and BG’ shot from 850p to 1200p. It is now 919p. This deal made sense if oil was going back to its glory days. The market is not so sure now. However its final regulatory hurdle – China – has been negotiated. Let’s see what shareholders make of the deal now.


Cinven announced that it had agreed to buy the fashion guru Kurt Geiger for £245 million. For Reckitt Benckiser to grab the headlines over misleading packaging of its Neurofen drug in Australia provides some idea of the thinness of the news flow. Maybe there will be repercussions here in Old Blighty. It was great to see Man Group post such an excellent luminary as Lord Livingston as its new chairman. Many were amused to hear that HSBC was considering Toronto to domicile its business. HSBC is strong in Canada, but there has always been a reluctance by Canada in allowing overseas banks to have full branch status. Maybe HSBC making its home in Canada will change that rationale. We hear that Crispin Odey has his boot well and truly planted in Home Retail’s ribs as an aggressive ‘short.’ Poor old RBS will have some explaining to do about the 4500 dormant accounts which they were duplicitous over. It never rains but it pours. Its shares are down 20% in recent months


On the Street of Dreams a bear squeeze rally took place despite oil dipping to $35 a barrel briefly. The DOW ended the session up 0.60% with the S&P 500 +0.48% and the NASDAQ +0.38%. Dealers were ruminating over tomorrow’s FED decision and at 5.00am this morning the ASX was +0.08%, the Shanghai Composite +0.09%, Hang Seng +0.51% though the Nikkei was down 0.69%, despite a reasonable Tankan survey yesterday, which indicated that lending to SMES was increasing. China has not surprisingly overtaken the UK in FinTech. The FTSE may open up 65 points the good – a bear squeeze rally?



UK companies posting results this week – Tuesday – Imagination Technology, Carpetwright, Petrofac Wednesday – Dixon Carphone, SuperGroup, Thursday -Premier Farnell, Friday – Carnival, Trinity Mirror


US companies posting interim results this week – Wednesday – Joy Global, Jabil Circuits, FedEx, Thursday – Red Hat, AAR, Friday – Lennar, Darden Restaurants 


Economic Data – Tuesday – UK inflation, US CPI, Wednesday – FOMC meeting, UK employment Thursday UK Retail sales.


David Buik


Market Commentator – Panmure Gordon & Co


TODAY’S FAYRE – Sunday, 13th December 2015


“When you are old and grey and full of sleep,

And nodding by the fire, take down this book,

And slowly read, and dream of the soft look

Your eyes had once, and of their shadows deep;

How many loved your moments of glad grace,

And loved your beauty with love false or true,

But one man loved the pilgrim Soul in you,

And loved the sorrows of your changing face;

And bending down beside the glowing bars,

Murmur, a little sadly, how Love fled

And paced upon the mountains overhead

And hid his face amid a crowd of stars.”


William Butler Yeats – poet – 1865-1939


It has been an infinitely forgettable week – in fact awful. The runes in the sand had been suggesting that most global indices were fully valued – even over-priced, but many involved in equity markets were in denial. Traders and observers alike have metaphorically been given copious boots in the ribs, warning them of the vagaries and pitfalls staring them in the face – head on! 


Falling oil prices, down to $37 a barrel (a 7-year low), is a two-edged sword – great for the consumer and industry, but a very clear sign that all is far from well with growth in certain parts of the world and that geopolitical issues threaten on-going dangers. One cannot help feeling that, despite encouraging industrial production figures over the weekend – up 6.2% last month against an estimated 5.7% and adequate retail sales – up 11.2% – all is not well in China and more to the point emerging nations. Then of course commodity prices continue to cascade downhill, savaging value of the likes of Glencore, Anglo-American, Rio, BHP Billiton, Lonmin, Vedanta, and Antofagasta. These mining companies have lost the best part of 65% in value in the last year


Anglo American did not prepare the market well with its cuts in staff of potentially as many as 80.000 employees. Investors vented their spleen taking the shares down by 18% last week. Conversely, after a few torrid week of concern over its debt mountain, Glencore’s CEO Ivan Glasenberg placated their acolytes with a plan which consisted of cutting debt sharply to $18 billion and selling assets, which may prove harder to do than has been suggested. Nonetheless the shares rallied 8% in approval on Thursday. 


There were also other imponderable that weighed on heavily on the markets. Companies are not producing growth. Punters are beginning to see through share buy-backs as a means of delivering shareholder value and fund managers are becoming more cognoscent of the fact dividends are falling. The very idea that Royal Dutch Shell could really yield 8% must be challenged. A dividend of that magnitude could never be sustained. 


Then from a parochial perspective, the MPC kept rates unchanged at 0.5% for the 82nd consecutive month on an 8-1 vote in favour of no change, with just Ian McCafferty continuing to buck the trend, insisting it was time for the consumer and business to be weaned off ‘mother’s milk!’ This ‘Forward Guidance’ caper has been a disaster. It has been mischievous and misleading, leaving the BOE and the MPC in a quandary. There’s no inflation; there might be 1% inflation in the summer of 2016 and 2% in 2017 but I would not be about to hold my breath. Perhaps it might be a good idea to start withdrawing QE at a rate of £25 billion a month rather than constantly threatening to put up rates and never actually getting around to doing it. There is no doubt that for some years there has been a surfeit on money in equities, taken from the bond and fixed interest market, where yields have been derisory. We are now seeing money withdrawn. We must also not forget the contribution programme trading and algorithms have contributed to volatility and forced selling this year.


The FTSE fell 4.5% in value last week to 5952 – 7 consecutive daily reverses for London’s main index. This year it has dropped from 6566 – down 9.4% and 16.2% down since its all-time high on 26th April 2015! As for the rest of the global indices, last week the S&P eased by 3.6%, European bourses by an average of 4.1% and the Nikkei by a parsimonious 1.4% thanks to the Yen weakening favouring export related stock and better than expected economic data. 


US markets were probably saved from further larruping by yet another mega M&A deal – Dow Chemical agreeing to merge with DuPont in a $120 billion deal. Certainly the quest for greater market penetration to deliver shareholder value has been very prevalent in the US this year. Adobe was one of very few winners on the Street of Dreams on Friday. JetBlue lost 6%, Baker Hughes 5.9%, Goldman Sachs 2.5% and Morgan Stanley 2.3%. Back home here in Old Blighty we have already dealt with mining’s tale of woe. Premier Oil and Tullow lost 13% and 9% respectively. Royal Dutch Shell fell over 4%, which brought validity of the BG deal into question again. Ocado dropped 3.5% and Tesco 4.5%. Sports Direct attracted significant bad publicity from Thursday’s trading statement. CEO Mike Ashley has treated the market with contempt with unorthodox attitudes towards employment contracts. The shares fell 15.7% last week.


On the banking front the BOE let it be known that banks and investment operations would need to raise £27 billion of fresh capital to avoid a repetition of ‘too big to fail’ bail-outs. It looks as though RBS has another can of worms to open to the public – attempting to hide the existence of cash from 4500 accounts, which were supposedly dormant. Add that to the investigation of miss-selling mortgage backed securities in the US suggests 2016 won’t be plain sailing for this accident prone operation. In recent months the value of RBS’S shares has dropped by 20% valuing this bank at a parsimonious £33 billion. It will be interesting to see if Tata can agree terms with Greybull and Endless, which could save 5000 jobs at the its Scunthorpe steel works. Last week it became public knowledge that Odey Asset Management has been shorting Home Retail, believing that Argos was probably ill-equipped to deal with the internet age and that Christmas sales could be disappointing.


To look for much Christmas cheer next week could be folly, though fund managers need to put their money somewhere!


UK companies posting results this week – Monday – Premaitha Health, Tuesday – Imagination Technology, Carpetwright, Petrofac Wednesday – Dixon Carphone, SuperGroup, Thursday -Premier Farnell, Friday – Carnival, Trinity Mirror


US companies posting interim results this week –– Monday – Delta Apparel, Wednesday – Joy Global, Jabil Circuits, FedEx, Thursday – Red Hat, AAR, Friday – Lennar, Darden Restaurants 


Economic Data – Tuesday – US CPI, UK Retail Prices, Wednesday – FOMC meeting, Thursday UK Retail sales.


David Buik


Market Commentator – Panmure Gordon & Co

TODAY’S FAYRE – VW to Glencore to Sports Direct to Whitbread


TODAY’S FAYRE – Thursday, 10th December 2015


“A woman waits for me–she contains all, nothing is lacking,

Yet all were lacking, if sex were lacking, or if the moisture of the right man were lacking.

Sex contains all, Bodies,

Souls, meanings, proofs, purities, delicacies, results, promulgations,

Songs, commands, health, pride, the maternal mystery, the seminal milk;

All hopes, benefactions, bestowals,

All the passions, loves, beauties, delights of the earth,

All the governments, judges, gods, follow’d persons of the earth,


These are contain’d in sex, as parts of itself, and justifications of itself.

Without shame the man I like knows and avows the deliciousness of his sex, 10

Without shame the woman I like knows and avows hers.

Now I will dismiss myself from impassive women,

I will go stay with her who waits for me, and with those women that are warm-blooded and sufficient for me;

I see that they understand me, and do not deny me;

I see that they are worthy of me–

I will be the robust husband of those women.”


Walt Whitman – poet – 1819-1892


I am amazed that most people don’t think as I do, when it comes to using the NHS as a political football. We should all be sick and tired of the way whistle blowers or ‘snitches’ try and tear this potential world class service apart. One crusade follows another in an attempt to discredit the whole service. Unfortunately the NHS is ring-fenced financially. Even the government can’t have the drains up to expose its inefficiencies and inadequacies – too much of a political ‘hot potato. A five-year term in government is insufficient time to do what is required. I had great hopes that Lord Rose would ruthlessly expose the services’ shortcomings, but the silence has been deafening. Perhaps no one wants to listen.

What is ironic is that everyone knows what needs to be done. It is hopelessly top heavy with expensive management – hundreds of people earning between £100k and £500k. One could be forgiven that thinking a staff on 1.7 million could deliver a reasonable service. The department is over-staffed administratively and under-staffed medically. The situation is classic example of how to play the blame game. Everyone says that the ‘head honcho’ Simon Steven is a top drawer administrator, but it strikes the that the individual trust directors and Unions are closing ranks preventing the implementation of radical changes, with the Secretary of State, Jeremy Hunt, up the creek without a paddle. Frankly it is a national disgrace what is happening. All political parties come out of this issue with little credit. The NHS should no longer be ring fenced and should be exposed to comprehensible public scrutiny.


Foreign exchange grabbed many headlines yesterday as the Yen increased in value mainly to the detriment of the Greenback. Also it appears that the Chinese authorities seem to be manipulating the Yuan in a southerly direction, to help exports and trade, much to the consternation of the US. It appears that the Yen has been dancing to the same tune as the Yuan, by heading north – Cable $1.5176, €/$1.1009 and $/Y121.67. It looks as though the FED will move to hike rates by 0.25% next week 15/16th December. If the US Central bank bottles it, it could create avoidable market turmoil. As for today’s MPC Meeting, Panmure’s chief economist, Simon French believes its ‘Casablanca’ all over again – ‘Play it again, Sam! – vote 8-1 no change for the 82nd month running. Let me add a little rider by saying the wretched ‘forward guidance’ may suggest a spring increase – nothing new about that message!


Yesterday, the Street of Dreams was in no mood to start any sort of a Christmas rally. Despite the announcement of another huge merger, likely to be confirmed today between DOW Chemical and DuPont – both shares up 10% yesterday, investors shunned the opportunity of getting involved. As for the rest of it, falling oil prices and a gloomy outlook on commodities, despite an upbeat comment by Anglo-American on its cash flow situation, the mood was somnolent. Profit takers in Apple -2.2% and Amazon -1.85% were in evidence as the NASDAQ eased by 1.85%. The DOW closed down 0.43% and the S&P 500 down by 0.77%. The only other incident of note was Visa raising $16 billion from a bond issue – the 4th largest of the year.


In Asia the mood was again cautious in the wake of commodities, oil and a stronger Yen, with the ASX closing down 0.84% and the NIKKEI by 1.32%. Just after lunch the Shanghai Composite was easier by 0.49% and the Hang Seng by 0.89%.

There was a slew of earning this morning, though let me deal with two issues beforehand. Since the news of VW duplicitous behaviour over diesel engine controls broke, its share price has fallen 20%. However VW seem to have been quite dismissive as to the damage caused to the company. They announced that it was unlikely that it will need to use a €2 billion provision, which it had set aside. The shares rallied 3.38% on the back of this news. Glencore posted a statement at 8.30am which read quite positively, according to Panmure’s Kieron Hodgson. Ivan Glasenberg the CEO set out plans for cutting its debt and employment requirements quite succinctly. There are also plans to sell assets. However in a seller’s market the prices may be depressed and achieving that goal may prove challenging. The market liked the statement and shares rallied by 8% to 89.9p at 8.31am.


This morning there were tolerable efforts from John Wood, Photo-Me, Centrica and Micro-Focus and Go-Head. The same cannot be said of Sports Direct and its Machiavellian CEO Mike Ashley. He seems to have his own set of rules about employment terms and taking stakes in other companies, coupled by the fact that he is not the greatest communicator with analysts or the media. He has incurred the wrath this morning of The Guardian’s Simon Goodley. Sports Direct’s results were fairly average by their standards with revenues up 2.5% and profit by 5.2%. Investors treated this compendium of news viscerally – shares down 5%. Christmas will be a key period going forward.


Finally let’s take a look at Whitbread. Panmure’s Anna Barnfather has got this company spot on. She flagged up a ‘sell’ notice in March. Shares have fallen by 16% to yesterday. They were off another 3% this morning after slightly lack lustre trading statement, particularly in the wake of the Ruby World Cup. Total like for like sales were up 3.5% when 4-5% was estimated. Premier Inns’ sales were up 3.6% which was considered weak and Costa Coffee only up 2.5%. Andy Harrison the CEO who hands over to Alison Brittain in January – ex Lloyds Banking – assures the market that the company is on course to achieve its goals.

UK companies posting results this week – Thursday – Sports Direct, Micro-Focus, John Wood Group, Centrica, Photo-Me, Marshalls, Darty, Whitbread (TS), Ocado (TS), Go-Ahead (TS), Tui Travel (TS), Friday – Bellway (TS), MJ Gleeson (TS).


Economic Data – Thursday – BOE MPC meeting US trade Data


David Buik


Market Commentator – Panmure Gordon & Co 


TODAY’S FAYRE – Wednesday, 9th December 2015


“When I shall be divorced, some ten years hence,

From this poor present self which I am now;

When youth has done its tedious vain expense

Of passions that for ever ebb and flow;


Shall I not joy youth’s heats are left behind,

And breathe more happy in an even clime ?–

Ah no, for then I shall begin to find

A thousand virtues in this hated time!


Then I shall wish its agitations back,

And all its thwarting currents of desire;

Then I shall praise the heat which then I lack,

And call this hurrying fever, generous fire;

And sigh that one thing only has been lent

To youth and age in common–discontent.”


Matthew Arnold – poet – 1822-1888


Germany posted its first trade data since the VW crisis and it is hard to really work out how adversely that news affected these numbers – Exports last month were down 1.2% and imports by 3.4%. It could take another month or two to get the real picture. Maybe the good people of Wolfsburg will eke out a few crumbs of comfort, having seen its football team tip Manchester United out of the champions League last night with a 3-2 victory.


Surely there is an awful lot of ballyhoo and hot-air being spoken about Tyson Fury’s candidacy for SPOTY. One either votes for him for his achievement in becoming heavyweight champion of the world in all divisions or you don’t vote for him. Vote for Murray or whoever! Fury’s ‘left field’ odious ‘non-PC’ ideas on sections of society are of no consequence in this issue – Surely?


There were only a couple of issues on equities’ agenda yesterday, if the truth be told and that was oil prices, which sank to a 6 year low in New York last night before rallying by just under 2% in Asia this am and the continuing rout of commodity prices, particularly copper and iron ore. Ironically yesterday it was Anglo American that grabbed the headlines, when Mark Cutifani announced that this gold mining titan would not be paying a dividend for the second half of 2015, nor would it be paying one in 2016. He also said that the 135k workforce would slashed mercilessly may be down to 95k by the end of 2o16. These comments were met by visceral treatment from shareholders, which took Anglo’s shares down by nearly 12.2% by the end of the session. Anglo’s shares have fallen by 74% in a year and 94% since 2010 when they stood at their pinnacle at £34. Unfortunately and not surprisingly other mining companies fell in sympathy yesterday – Glencore down 8%, BHP and Rio both down 5%. In hindsight to have been so reliant on China for demand, looks to have been folly, in valuing this sector.


Talk of oil prices going to $20 a barrel by Goldman Sachs may be fanciful, as demand does not seem to be weakening. Also Iran may take some months to be fully operational and politically for oil to be that depressed in price would be unsustainable for many countries.


So yesterday on the back of such dreary news the FTSE fell by 1.45% (88 points) to 6135. Although Anglo-A attracted most of the headlines today, losses were across the board – not a single sector in the green. It appeared to many that growth fears are escalating and gathering momentum yet again. The DAX lost 1.95% in value and the CAC 1.57%. The Street of Dreams was equally uninspiring as a hunting ground, with oil and resources knocking the stuffing out of any semblance of a positive sentiment. The DOW closed down 0.92%, with the S&P 500 also under water – -0.65%. The NASDAQ proved quite resilient closing -0.07%. After hours it was announced that conversations were taking place between two giant chemical moguls – Dow Chemicals (shares up 5.5%) and Dupont (shares up 6.2%) about a merger. Yahoo! also popped after hours, when it became clearer that the internet luminary would not be selling its stake in Alibaba.


Inflation data from China did not suggest that hope sprang eternal, though factory prices rose by 5.9%%, but CPI stands at only +1.5%, which is a slightly worrying deflationary trend. Japan produced unexpectedly good machinery orders +10.7% month on month but that could be just a blip. Anyway Asian markets were also affected by the commodity rout! Heading towards the close the ASX was down 0.55% with the NIKKEI easier by 0.98%. The Hang Seng was down 0.41% with the Shanghai Composite remaining just above the Plimsoll line – +0.02%.


UK companies posting results this week – Wednesday – Balfour Beatty, Stagecoach, Focusrite, Ashtead, Carillion,  Thursday – Sports Direct, Micro-Focus, John Wood Group, Centrica, Photo-Me, Marshalls, Darty, Whitbread (TS), Ocado (TS), Go-Ahead (TS), Tui Travel (TS), Friday – Bellway (TS), MJ Gleeson (TS).

US companies posting interim results –  Toll Brothers, Costco, Krispy Kreme, Wednesday – Korn/Ferry, Men’s Wearhouse


Economic Data – Thursday – BOE MPC meeting UK trade Data


David Buik


Market Commentator – Panmure Gordon & Co



TODAY’S FAYRE – Tuesday, 8th December 2015


I must down to the seas again, to the lonely sea and the sky,

And all I ask is a tall ship and a star to steer her by,

And the wheel’s kick and the wind’s song and the white sail’s shaking,

And a grey mist on the sea’s face, and a grey dawn breaking.

I must down to the seas again, for the call of the running tide

Is a wild call and a clear call that may not be denied;

And all I ask is a windy day with the white clouds flying,

And the flung spray and the blown spume, and the sea-gulls crying.

I must down to the seas again, to the vagrant gypsy life,

To the gull’s way and the whale’s way where the wind’s like a whetted knife;

And all I ask is a merry yarn from a laughing fellow-rover

And quiet sleep and a sweet dream when the long trick’s over.”


John Masefield – poet laureate – 1878-1967


The 4th test match between India and South Africa in Delhi was remarkable for a number of reasons.  Firstly South Africa was world No1 and ended the series being trounced 3-0 by a very good improving Indian side, under the enthusiastic and youthful leadership of Virat Kohli.  In the final innings South Africa took 143.1 overs to be bowled out for 143 to lose the game by 327 runs. Secondly 22 runs, which were scored in the first session before lunch, was the lowest run making session in a 2-hour test match session in history. India have some great batsmen in all conditions and the talents of   Kohli, Vijay, Sharma, Rahane and Pujara should serve them well in the years to come, though history tells us India find it difficult to win away from home. South Africa was humbled in India. Let’s hope England can take advantage from this poor vein of form, though Steyn and Philander may well be back to lead their attack.


Heathrow/Gatwick/Estuary airport – Had this been Germany a new runway would have been up and running for about 2 years. By all means consult with business, airlines and most important of all, the environment and those who live in the area. But then it has to be decision time!! That is why we elect governments – to make decisions. So do us all a favour, Mr Cameron and make one. Through an unacceptable level of prevarication, the UK and London in particular is losing business. As the crow flies I live 8 miles from Heathrow, if it has to be there – so be it! I have lived in the flight path of London Airport for 21 years – makes no difference to me!


Market activity yesterday reflected my mood and the weather – dull, dank and uninspiring. German Industrial production for October failed to ignite any smouldering embers of hope. It expanded by just 0.2% for October – very disappointing as against estimates of +0.7%. Europe gave equities its best shot with the DAX adding 1.25% and the CAC +0.88%. However the FTSE 100 made a rather pathetic effort to lift itself from Friday’s doldrums. On the Street of Dreams the DOW eased by 0.66%, the S&P down by 0.70% and the NASDAQ by 0.79%. Airlines did well on cheap oil. Chevron and Exxon Mobil received some visceral treatment, but nothing as violent to that meted out to Office Depot – down 15% and Staples down 13%.


Though the US markets accepted that the Farm Payroll data was likely to signal a 25 basis point hike on 15/16 December, there was less enthusiasm for it here in Europe, with many also being concerned about emerging countries and how their respective economies would react. The FTSE closed down 0.24% to 6223, thanks in the main to poor performances from BP, Shell and BG Group – down between 3-4.5%. Oil prices fell to a 7-year low to $37 a barrel, triggered by a lack of agreement to cut production at Thursday’s OPEC meeting at Saudi Arabia’s instigation. Russia and Iran decline the invitation to cut production – Quelle surprise! Below $40 a barrel, Russia’s economy is in the ‘cack’, exacerbated by tough sanctions being imposed the West – hence Putin being very happy to court Iran and Iraq, whilst attempting to tie up all traffic from these countries through Syria, in attempt to neutralize Saudi Arabia. Saudi Arabia has a growing budget deficit – not good news when all they have is oil, defense and construction.


This morning Asian stocks may have wanted to put their best foot forward but slightly disappointing Chinese trade data – a little better than awful – took the rug from under the market’s feet. Exports were -6.8% in November (-5% in Oct) & imports were -8.7% in November (-12.6% in Oct). Not surprisingly there was no appetite for risk in the Far East. At the close the ASX was down 0.91% and the NIKKEI by 1.04%, despite a revision in GDP suggesting that growth would be 1% above the Plimsoll line for 2015. Just after lunch the Shanghai Composite was down 1.89% and the Hang Seng was easier by 1.55%.


Retail sales in the UK were a bit of a mixed bag. Like for like sales were down 0.4%. The previous year they had increased by 0.9%. However ‘on-line’ were up by 11.8% (£1.1 billion) against 12% in the corresponding period to November 2014. Like many others I am becoming very nervous about Greece’s finances – not for the first time. Greece needs another €1 billion to boost its finances but has yet to implement an austerity programme required; hence the yield on Greek 10-year bonds is up nearly 1% from a month ago to 8.33%! Greece has a week to deliver! Did you see that pink elephant flying across the window? Serco disappointed due to lack of new contracts after General Election – down 4.5%. NAB is considering an IPO for Clydesdale Bank. Tesco had more bad news as Jill Easterbrook served notice to leave after 15 years’ service. Tesco shares fell 3%.


This morning it was the mining sector and Rolls Royce that dominated the FTSE 100 opening. Anglo American at its investor meeting announced dividend cuts which has sent the stock in to free fall – down 6.5% at 9.06am. Rio and BHP are both down 5% in sympathy. Rolls Royce after a downgrade is 2% light and the FTSE 100 s down 14 points at 6209.


UK companies posting results this week – Tuesday – Hornby, Wednesday – Stagecoach, Focusrite, Ashtead, Carillion, Thursday – Sports Direct, Micro-Focus, John Wood Group, Centrica, Photo-Me, Marshalls, Darty, Whitbread (TS), Ocado (TS), Go-Ahead (TS), Tui Travel (TS), Friday – Bellway (TS), MJ Gleeson (TS).

US companies posting interim results – Tuesday – Autozone, Toll Brothers, Costco, Krispy Kreme, Wednesday – Korn/Ferry, Men’s Wearhouse


Economic Data – Tuesday – EU GDP, UK Industrial production and manufacturing output, BRC sales, Thursday – BOE MPC meeting UK trade Data


David Buik


Market Commentator – Panmure Gordon & Co