TODAY’S FAYRE – Wednesday, 3rd February 2016


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–

I 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 shrudder comes o’er me–

Why wert thou so dear?

They know not I knew thee,

Who knew thee so well–

Long, long I shall rue thee,

Too deeply to tell.


In secret we met–

In 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


My much revered and respected colleague, Simon French, Panmure’s Chief economist, tells me that PM Cameron’s government has negotiated the basis of a very workable agreement with the EU, particularly acceptable to the City of London, which should meet the country’s support in a Referendum, which could take place as early as June. In a serious vain, he knows about these matters. There is NO sarcasm on my part!


The UK is basically conservative with a small ‘C’ and does not like change. So I fear the ‘IN’ brigade, aided and abetted by the power and influence of big business, who will be massing their scaremongering troops and PR aficionados will have their day in the sun when the votes are counted. However this old fool is having none of it. Much of the content of this deal is fudged and regurgitated, I can see little change and the terms seems to have more potential holes in it than a sieve! I just hope and pray that the ‘widget maker from Wisbech’ agrees with me. This country still has a heaven sent opportunity of delivering itself from the ‘House of bondage’ in to a brave New World, embracing all-comers including Europe in to the bosom of a trading family, without discrimination. I don’t even need to mention the prickly issue of immigration. This is not an issue that just affects the UK – it affects all of Europe, if not the entire universe! Finally we must not forget that getting 27 countries to agree is a task of Herculean proportions. So any deal is far from done.


I am really looking forward to the day when I can observe or comment positively about markets, deals, opportunities. I fear today is not going to be that day. Markets headed sharply lower driven by a combination of a stench of fear, sharply lower oil prices, some very bad corporate results and a large dose of negative sentiment. Suffice to say that BP’s dismal effort (-8.9%), which may results in 7000 redundancies and the Pru’s rather unfortunate clash (-8%) with China over payment of premiums, drove the London market steeply lower – down 138 points to 5922 (-2.28%). The confirmation of J Sainsbury buying Home Retail (Argos) for £1.3 billion almost went unnoticed though Argos’s IT contribution and high Street warehouses were seen as pivotal to the deal.


There was little cheer on the Street of Dreams with oil all but falling out of bed drifting to $29 a barrel. Corporate news was quiet though sentiment was negative with little appetite for risk manifesting itself. Marissa Mayer’s plans for Yahoo! are clearly requiring a rethink with further assets probably needing to be dispensed with. 15% of the staff may be shown the door. Let’s deal with the scraps of good news. There were sound performances from Dupont and Dow Chemicals – both up over 5% due to M&A activity. Mattel was 13% to the good. Apple -1.9%, Exxon Mobil -1.7%, Pitney-Bowes -2.7% were amongst senior stocks to enjoy a poor performance yesterday. Alphabet, after a fabulous day and set of numbers on Monday added another 1.3% yesterday. US car sales flat lined in January, though there were very encouraging sales for trucks and jeeps. Fiat of the overseas makers thrived the best. Ford and Toyota posted poor months and the rest kept chugging away.


There were sound results from Hargreaves Lansdown and Foxton’s, though Johnson Matthey’s effort was less conclusive. We wait for Glaxo at noon. I have to confess to being astonished that NAB and its advisers allowed Clydesdale to take its chance in today’s IPO, with markets in such turmoil. However 25% was sold at the bottom end of the range with shares issued at 180p. So a modest premium – dealing at 182.5p, valuing the bank at circa £1.6 billion – is very acceptable in the climate. However with so much banking stock, or potentially so, on offer it was a brave move – one I would not have contemplated. However faint heart never won fair lady.


Asian markets continued to be out of sorts with the ASX closing down 2.33%, and the NIKKEI by 3.15%. The Shanghai Composite was down only 0.38% thanks to official cash injection ahead of next week’s holiday, though the Hang Seng was down 2.34% as it headed towards the close. The only good news was decent numbers from Lenovo, adequate efforts from Nintendo and confirmation that ChemChina has offered $43 billion for Syngenta.


U.K. earnings this week – Wednesday – Foxtons, Hargreaves Lansdown, GSK, Severn Trent, Johnson Matthey, Thursday – Royal Dutch Shell, Astra Zeneca, Smith & Nephew, Bellway, Vodafone, Compass Group, Friday – BG Group, Aon



US Earnings posted this week – Wednesday – Merck, Marathon, Thursday – Yum! Brands, Philip Morris, Boston Scientific, Metlife, Cigna, Marsh McLennan, Friday – Tyson Foods, Weyerhaeuser, Moody’s.



Economic data this week – Wednesday – ADP Employment Index, Thursday – Inflation Report & MPC Meeting, US Jobless Claims, Friday – Non-Farm Payrolls,



David Buik


Market Commentator – Panmure Gordon & Co 


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