TODAY’S FAYRE – Thursday 31st March 2016

 

“The stars, a jolly company,

I envied, straying late and lonely;

And cried upon their revelry:

“O white companionship!

You only In love, in faith unbroken dwell,

Friends radiant and inseparable!”

 

Light-heart and glad they seemed to me And merry comrades

(EVEN SO GOD OUT OF HEAVEN MAY LAUGH TO SEE THE HAPPY CROWDS;

AND NEVER KNOW THAT IN HIS LONE OBSCURE DISTRESS

EACH WALKETH IN A WILDERNESS).

 

But I, remembering, pitied well And loved them,

who, with lonely light, In empty infinite spaces dwell,

Disconsolate. For, all the night, I heard the thin gnat-voices cry,

Star to faint star, across the sky.”

 

 Rupert Brooke – soldier & poet – 1887 – 1915    

 

T-20 final, England made it! – Certainly Jason Roy, Joe Root and Jos Buttler made England’s passage to the final in Kolkata on Sunday look sublimely easy! Will their opponents be Australia or the hosts, India?

 

I see that Denise Gough is a very warm order with Ladbrokes to carry off the Olivier award for the best performance by an actress on the stage this year for ‘People, Places & Things.’

 

For racing aficionados I strongly recommend a very short book on perhaps the greatest period for wholesale gambling in horseracing – ‘The Druid’s Lodge Confederacy.’ The plans for these great coups are laid out and hatched at the turn of the twentieth century by a small select group of landed gentry at a purpose built stable on Salisbury Plain – The Druid’s Lodge – now the domain of the Hannon operations today. Those were days and the behaviour was deliciously outrageous. A sublime read!

Janet Yellen’s soothing wand was still being waved down most streets in the Wall Street area and all-over beautiful downtown Manhattan yesterday, which kept the equities embers smouldering away. In fact the DOW is now in positive territory for the year – +1.7% and the S&P 500 is 1% to the good in 2106. With inflation unlikely to nudge 2% in the foreseeable future and despite decent ADP numbers (+200k for private sector employment) posted yesterday, it seems unlikely that rates will be raised before June, if at all then. With so many international imponderables, the FED is understandably circumspect and cautious. Equities have regained their poise, but it would not take much to knock them off their pedestal again – oil prices, geopolitical pressures such as US Presidential election and BREXIT and most important of all the increasing concern about many banks – both in the US and here in ‘Old Blighty.’ How rude is their health? How onerous are the capital requirements? Are some of these gargantuan loans to the energy sector going to be perhaps a straw that breaks a few camels’ backs? Also I hear PPI claims are up another 6% likely to take the grand total of claims to in excess of £30 billion!

 

It was a good day for insurers on the Street of Dreams. It is slowly becoming apparent that many are now losing the unnecessary tag of ‘too big to fail.’ Metlife was up 5% and the likes of Prudential Financial and AIG rose by an average of 2%. Banks have been out of sorts in recent sessions. However, yesterday some stability prevailed for the sector, though Bank of America was under the cosh – down 4.5%. Apple, with new toys on the shelves and Google seem to be the standard bearers for the resurgence for the tech sector. In London yesterday markets put behind ‘chamber of horror’ period in January and February behind it by nudging in to positive territory. The FTSE added 1.57% to 6203. Miners and oils were in good fettle. It is terrifying seeing a stock like Anglo bouncing around in double digits in a day’s trading. Oils were strong with RDS, BP and Tullow performing with aplomb. Despite the nervous start to the New Year Carnival posted decent numbers. I suppose my age group keep cruising, come hell or high water. Premier Foods is starting to convey the impression that it will eventually do a deal with McCormick of the US though above the £1.5 billion already on the table.

 

There has been well-chronicled and devastating news on Tata’s steel operations in the UK. Tata believes they are worthless which makes attracting a buyer in the future very difficult, if not impossible. Attempting to prevent 20,000 from possibly losing their jobs is devastating and redeploying them in to other trades will take time. The writing has been on the wall for steel demand with falling prices for at least 3 years. Even Archelor Mittal is struggling. I have to say the performance or influence of the EU in terms of protecting member countries from excessively cheap steel imports from China with sensible quotas has been lamentable. In the immortal words of Many Rice-Davies (RIP) – ‘You would say that wouldn’t you! In fairness the problems that the UK and EU have with steel, however horrific the human story is pales in to insignificance in comparison with China’s acute concerns. It is possible that 6 MILLION will need to be laid off in China. At 9.30pm 4th quarter UK GDP will be posted. It is expected to come in at +0.5%. Manufacturing has been a little weak – hence the tentative number. Consumer confidence in the UK was posted as flat. There has been a degree of exaggeration in terms of deep concern.

 

It was interesting to note comment in the FT that IPOS in the US for the first quarter were down to pre-crisis 2009 levels with 21 IPOS valued at in excess of $3 billion had been shelved. Only 9 companies valued at $1.2 billion made listings. There has been a marked ‘pick-up’ in activity since the market ‘low’ of 11th February 2016.

 

Oil prices were lower and inevitably inertia set in Asia, apart from Australia, where mining stocks enjoyed a bit of a run on the rails – ASX closing up 1.4%. The NIKKEI was easier by 0.7% and the Shanghai Composite was up 0.1% with the Hang Seng closing close to being -0.36%. It was confirmed this morning that Taiwan’s Foxconn confirmed it has bought one of Japan’s great brand names – Sharp – for a knocked down price of $3.5 billion.

 

UK companies posting results – Thursday – HILTON FOODS, WIRELESS GROUP, JAMES HALSTEAD, CHESNARA, CMC MARKETS, and TUI TRAVEL

  Economic Data –Thursday – UK CURRENT ACCOUNT & FINAL GDP for 2015, Friday – UK PMI MANUFACTURING & CONSTRUCTION, 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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