TODAY’S FAYRE – Thursday, 3rd March 2016

“Heart, you are restless as a paper scrap

That’s tossed down dusty pavements by the wind; Saying,

“She is most wise, patient and kind.


Between the small hands folded in her lap

Surely a shamed head may bow down at length,

And find forgiveness where the shadows stir

About her lips, and wisdom in her strength,

Peace in her peace. Come to her, come to her!” . . .


She will not care. She’ll smile to see me come,

So that I think all Heaven in flower to fold me.

She’ll give me all I ask, kiss me and hold me,

And open wide upon that holy air

The gates of peace, and take my tiredness home,

Kinder than God. But, heart, she will not care.”


 Rupert Brooke – soldier & poet – 1887 – 1915


In less than two years the former Olympic cyclist Victoria Pendleton has made herself in to a very competent amateur NH jockey.  Trust me folks that is no mean achievement.  You need to be brave as well as a decent horsewoman. Having fallen at Fakenham a couple of weeks ago, she made all at Wincanton yesterday to win the Hunter Chase for owner Andy Stewart on the Paul Nicholls trained ‘Pacha Du Polder’ in some style, beating ‘Big Fella, Thanks’, who was a useful tool on his day by 29 lengths. This momentous win should qualify her to run in the St James Place Foxhunters at the Cheltenham Festival on Gold Cup day (Friday).  Few will comprehend what an amazing triumph that victory was!


I was very sad to hear of the death of Martin Crowe at the age of 53 one of the greatest batsmen ever produced by New Zealand. Who will forget his contribution to the 1992 World Cup? He fought his illness stoically, but was forced to give up the unequal struggle. RIP


After the recent staggering rally international bourses have experienced in the last 10 days, virtually wiping out the previous weeks’ losses, the market enjoyed a well-earned breather yesterday. I am quite a simple soul and I have scratched the back of my head copious times incredulously at the strength of the rally and I have no real answers as to why it has taken place. My revered colleague, Simon French, Panmure’s chief economist, tells me the following –


“The rally back in equities can be traced to a combination of oversold conditions earlier in the year, the promise of broader QE from the ECB (Draghi letter earlier this week hinted at technical changes permitting purchases of a wider range of assets at 10 March meeting), and of course a global services sector that remains in rude health.”


Was FED Chairman Yellen tardy in raising interest rates? Should she then have backed off as she did? Simon says –


“The timing of the next US rate increase has come right back in to September 2016 after drifting to 2018 when the S&P hit 1830. We are not out of the woods when it comes to global manufacturing (teetering on the edge of recession) or indeed the careful rebalancing act in China where forward guidance remains exceptionally limited. Both should ensure that the VIX and more importantly the VVIX remain elevated but with U.S. election now firming around a Clinton presidency this should provide a counterbalance to political risk in the EU.”



So yesterday the FTSE fell by 0.09% to 6147. Banks were in demand in places with HSBC up 2.3% and Standard Chartered by 5.3%. Mining stocks were also popular and this morning news of a $5 billion settlement with Vale/Sanmarco disaster, which cost 19 lives with thousands made homeless, payable over 15 years, buoyed BHP’s shares by 3% this morning. Again economic data from the EU was less than encouraging with wholesale prices falling 2.9% last month – deflation threatens.



Yesterday the Street of Dreams seemed full of inertia, despite decent ADP Index employment data which illustrated the creation 201k jobs in the private sector, which could augur well for Friday’s Payroll data. The DOW added 0.2%, the S&P also 0.2% and the NASDAQ rather more up 1%. A slight rally in the oil price helped improve sentiment but it was interesting to note that Exxon Mobil may be forced to cut their capital expenditure by as much as 25% next year unless conditions pick up. Abercrombie & Fitch’s results were mixed but on balance the market liked the recent sales activity and the shares rallied by 4.3%.



In London yesterday the reaction to ITV’s overall results was variable. There was concern over next year’s advertising revenues from the European Champions competition, which saw the shares down by 3%, though overall ahead of Archie Norman’s departure as chairman and the arrival of Sir Peter Bazalgette to replace him, the year’s results were impressive. Virgin Money yesterday posted a 53% increase in profits, which saw shares up sharply by 5.8%.



This morning Asia held on to recent gains, despite a sharp fall in Chinese PMI service sector data. The ASX closed up 1.2% and the Nikkei up 1.25%. Towards the close the Shanghai Composite was 0.37% to the good and the Hang Seng was under water to the tune of 0.3%. This morning Admiral, Schroders, Aggreko and Domino Pizza posted strong results or updates. Whitbread, which has seen its share price fall from circa £52 to £39 in the last posted sales that were below expectation in comparison to recent efforts, resulting in investors taking some exposure off the table – shares down 2.54%. Panmure’s Anna Barnfather has been on top of this company in terms of her doubts as to the outlook.



Since its demotion from the FTSE 100 back in December, Wm Morrison has added 40% to its share value, some of the increase attributable to the Amazon tie up. So the Bradford based supermarket returns to the FTSE 100; so hats off to Andy Higginson and Dave Potts for their innovative management skills. Morrison will be joined by Informa, Mediclinic and Paddy Power Betfair. We bid a sad sayonara to Sports Direct (I think Mike Ashley may take the company private), Aberdeen Asset Management whose commitment to Asia is heavy, Smiths Group and Hikma. The FTSE at 9.45 is up 7 points at 6155. Dividends today cost 13.14 points on the FTSE today with HSBC the largest contributor. The opening on the Street of Dreams looks flat.


UK companies posting results this week – Thursday – Whitbread, CRH, Admiral, Inmarsat, Genel Energy, Shawbrook, Travis Perkins, Friday – LSE, WPP


US companies posting interim results – Thursday – Rite Aid, Stage Stores, Ciena, Barnes & Noble, Kroger, Smith & Wesson, H&R Block, Friday – Big Lots.

  ECONOMIC DATA – Thursday – UK PMI services, US Initial Jobless Claims, Friday – UK CPI inflation estimates, US Non-Farm Payrolls & employment data. 


  David Buik

Market Commentator – Panmure Gordon & Co

D +44 (0)20 7886 2775

Mobile – 0044 7788 144 877

Panmure Gordon & Co

One New Change | London | EC4M 9AF | United Kingdom


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