TODAY’S FAYRE

TODAY’S FAYRE – Tuesday, 19th April 2016

 “Anger in its time and place
May assume a kind of grace.
It must have some reason in it,
And not last beyond a minute.
If to further lengths it go,
It does into malice grow.
‘Tis the difference that we see
‘Twixt the serpent and the bee.
If the latter you provoke,
It inflicts a hasty stroke,
Puts you to some little pain,
But it never stings again.
Close in tufted bush or brake
Lurks the poison-swellëd snake
Nursing up his cherished wrath;
In the purlieux of his path,
In the cold, or in the warm,
Mean him good, or mean him harm,
Whensoever fate may bring you,
The vile snake will always sting you.”

 

Charles Lamb – poet & author – 1775-1834

 

I fear for Leicester City and their incredible quest to become Premiership Champions against all the odds and with the full support of neutral observers. The suspension of Jamie Vardy may disrupt manager Claudio Ranieri’s well-made plans to bring the trophy home for “the Foxes” and their supporters. Spurs are continuing to play exceptional football as witnessed by those who watched Sky last night. They demolished Stoke 0-4 and are on a roll with momentum very much behind them.

 

Much of yesterday was spent examining HM Treasury’s Report on the consequences of leaving Europe. On the whole the feedback was vitriolic, critical and derisive. Though forecasting is a dangerous occupational hazard, it is essential to provide data to enable voters to make a reasoned choice.  However 16 years out? WOW! Pure conjecture!  At least the Government has submitted its thoughts endorsed by many a seasoned and respected economist.  Those of us who support “Vote Leave” must do more than just offer hope and our aspirations, laced with platitudes.

 

The fall-out from the inconclusive OPEC meeting in Doha was significantly more muted than most had thought. Yesterday the markets took the news in their stride with the DAX and CAC finishing yesterday’s session way above the Plimsoll line and the FTSE, which still has oil and mining influence/worries and a measurable presence, closed its books 9 points to the good at 6353, despite crude oil falling by 4%+. This morning oil has rallied – Nymex $40.01 and Brent $43.06. The Chancellor’s/Treasury’s dossier on the threat of BREXIT on the UK economy was virtually dismissed as irrelevant by investors and day traders. Market did not take the slightest bit of notice.  Even the Pound rallied against the Dollar yesterday.  It is almost as if investors are immune to data and news they believe will not turn the world on its axis. Even airlines and travel operators made modest, if slightly unenthusiastic gains during the session.

 

Fat cat pay grabbed a few more headlines yesterday with many executives standing on very thin ice.  However I was pleased to see Bob Dudley make a robust defence of his remuneration – all richly deserved for saving BP from a fate worse than death over the past 5 years. The row over the domicile of the LSE post any deal with either Deutsche Boerse or ICE still rages. China was again attacked for flooding the world with an excess of steel. It appears that China is wholly ambivalent to the issue.

 

And so to the Street of Dreams yesterday. A weak Dollar against most currencies apart from the Yen kept investors’ spirits positive with the DOW closing up 0.60%, the S&P 500 +0.65% and the NASDAQ +0.44%. Morgan Stanley’s results were marginally less awful than expected though profits for the last quarter were down by 53%. The share rose by 3%. PepsiCo posted a neutral effort and after hours Netflix announced what appeared superficially as decent numbers with subscribers up by 6.7 million to 81 million. In recent years Netflix has always announced another country to take its facilities.  Last year it was Australia and New Zealand.  Yesterday drew a blank.  Investors felt future guidance was poor and they vented their spleen taking the stock down 7.84% to $99.90. Verizon would appear to be at the head of the queue as the most likely predator to land Yahoo!, which announces interim results today.

 

This morning Asian stocks kept their head above water. Australia enjoyed Rio’s 11% annual increase in iron ore output, though the last quarter fell back from recent efforts.  The ASX closed up 0.96% with Japan’s Nikkei closing 3.68% to the good thanks to a weaker Yen.  This rally, many market protagonists, is unsustainable. The Shanghai Composite dipped a smidgen below the Plimsoll line down -0.13% at lunch with the Hang Seng remaining buoyant +0.72%.  This morning there are a slew of earnings in the UK, with AB Foods posting a 35% increase in pre-tax profits for the first half year at £477 million. The analysts are still delving in to Primark’s contribution, which could be considerable as usual. AB InBev has received an offer from Japan’s Asahi Brewery for part of the SAB Miller portfolio that is for sale.

 

UK companies posting results –Tuesday – RIO, SAGA, AB FOODS, McCARTHY & STONE, BHP BILLITON (TS), ASHMORE, MEGGITT, UTLITYWISE, Wednesday – N BROWN, ARM HOLDINGS, MONEYSUPERMARKET (TS), GKN, TRAVIS PERKINS, PUNCH TAVERNS, Thursday – ANGLO-AMERICAN (TS), SEGRO (TS), GO-AHEAD (TS), SAB MILLER (TS), SKY, LADBROKES, COMPUTACENTER, PETS-AT-HOME, Friday – RECKITT BENCKISER (TS)

 

US companies posting interim results – Tuesday – GOLDMAN SACHS, SONIC, NORTHERN TRUST, HARLEY-DAVIDSON, UNITEDHEALTH, OMNICOM, JOHNSON & JOHNSON, YAHOO!, Wednesday – ABBOTT LABS, COCA-COLA, YUM BRANDS!, AMERICAN EXPRESS, MATTEL, BARNES & NOBLE, Thursday – ALPHABET, CITIZENS FINANCIAL, MICROSOFT, GENERAL MOTORS, PULTE, DR HORTON, NANK OF NEW YORK MELLON, BIOGEN, VISA, BJ RESTAURANTS, SCHLUMBERGER, Friday – CATERPILLAR, KIMBERLEY-CLARK


Economic Data – Wednesday – UK EMPLOYMENT DATA, US EXISTING HOME SALES, Thursday – UK RETAIL SALES, ECB PRESS CONFRENCE, US CONSUMER CONFIDENCE, Friday – GERMANY IFO REPORT

 

 

 –
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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