TODAY’S FAYRE – EU REFERENDUM DEBATE

TODAY’S FAYRE – Tuesday, 26th April 2016

 

Let us go then, you and me,

When the evening is spread out against the sky

Like a patient etherized upon a table;

Let us go, through certain half-deserted streets,

The muttering retreats

Of restless nights in one-night cheap hotels

And sawdust restaurants with oyster-shells:

Streets that follow like a tedious argument

Of insidious intent

To lead you to an overwhelming question…

Oh, do not ask, “What is it?”

Let us go and make our visit.

 

In the room the women come and go

Talking of Michelangelo.

 

The yellow fog that rubs its back upon the window-panes,

The yellow smoke that rubs its muzzle on the window-panes,

Licked its tongue into the corners of the evening,

Lingered upon the pools that stand in drains,

Let fall upon its back the soot that falls from chimneys,

Slipped by the terrace, made a sudden leap,

And seeing that it was a soft October night,

Curled once about the house, and fell asleep.”

 

 

 

TS Eliot – poet & author – 1888-1965

 

 

I was in tears for almost an hour yesterday listening to Radio 5-live posting the findings on the 14 counts of the jury’s 2-year hearing from the Hillsborough disaster in April 1989.  The South Yorkshire police, Sheffield Wednesday FC and some emergency services did not come out of this tragedy too well. Justice at last for the grieving families and Liverpool FC.  I thought Adrian Chiles handled the occasion with great sensitivity.

 

 

 

Last night The Spectator hosted a debate on the EU Referendum, sponsored by Rathbones at the London Palladium to a packed audience of 2,200 enthralled delegates. I must confess that I must ‘doff my titfer’ to Andrew Neil, the ‘Speccy’ Chairman who was the mediator for this glittering occasion.  In my humble opinion, Andrew has no peer in the realm in that capacity and last night he was on top of his game in bringing the debate to an animated crescendo! The ‘Vote Leave’ element won the vote by a wide margin, not necessarily because of content, but because the speeches by, in particular by Daniel Hannan, the Conservative MEP, Nigel Farage and Kate Hoey were so much more engaging and passionate. Hannan was on top of his game – what an orator! –  And if there were to be a ‘BREXIT’, what a huge talent he would be in the House of Commons, though I suspect he would be very much a maverick and thus, his own man. Nigel Farage was in barnstorming form and Kate Hoey, though not entirely gaff free, spoke from the heart for working class voters.

 

 

The ‘Remain’ speakers were Nick Clegg, Liz Kendall and Chuka Umunna.  The former deputy PM seemed to have ‘a monkey on his back’ last night and was very unconvincing with his Luke-warm, though impassioned arguments, only offering ‘doom & gloom’ if the UK left the EU.  There was no talk of heading for Valhalla! Liz Kendall started very well with her opening speech but sadly there was no depth to her argument and I am afraid to say Mr Umunna was very ‘lightweight’ in his presentation. Nonetheless it was a splendid occasion and grateful thanks to editor, Fraser Nelson and his colleagues for such an innovative and well-run occasion.

 

 

As was stated earlier in the week the week’s share dealing path would be decided this week by earnings and Central bank meetings in Washington and Tokyo and this morning financial life has panned out that way! Though trading was cautious yesterday, the FTSE ended the session 23 points to the good at 6284, largely due to a 10% spurt by Standard Chartered Bank, which posted results suggesting that Bill Winters and his team are starting to get their act together.  This has been a frustrating period for HSBC’s cousin. However this bank is beginning to focus on core business, whilst attempting to sell $20 billion of emerging market debt. Alison Brittain (EX Lloyds Bank) posted Whitbread’s numbers as CEO.  The results were better than expected but the shares only ended the day up 1%, as I suspect investors were marginally concerned that Whitbread has increased its debt for expansion plans. With the economy off the boil, one must trust their judgement that its brand will continue expanding. 

 

 

 

On the Street of Dreams, despite higher oil prices, there were still FOMC imponderables to consider and more dispiriting earnings from the likes of Twitter (-12%) and Procter & Gamble (-2.3%) to digest.  So unsurprisingly the DOW ended the session up just 0.07%, with the S&P 500 struggling to stay above the Plimsoll line +0.19%. The NASDAQ closed down -0.15%. The FOMC is expected to leave rates where they are at today’s meeting.  Few are convinced with the global economic vagaries under scrutiny, that a June hike is still unlikely.

 

 

But yesterday was always going to be about APPLE! The interesting dynamic is how the US tech sector is now a growing point of concern. For the first time in 13 years (51 quarters) Apple posted a 13% drop in revenues for the quarter to $50.56 billion. iPhone sales make up 60% of the revenue. Year on year sales were down 16% with China down 26% year on year. By the end of 2018 Apple is expected to have a cash mountain of $250 billion. EPS was $1.90 against expectations of $2. Profits slipped from $13.5 billion to $10.5 billion. What seemed to disturb investors most was no new toys until the autumn. When the bar is set high, expectations are huge.  Apple shares have fallen 20% in the last year and fell 7.9% yesterday after the bell.  

 

 

This morning Jes Staley, Barclays new CEO posted a mixed bag of numbers.  Profits were down from £1.06 billion to £793m – down 25%.  Impairment charges particularly to energy companies were up from £386million to £446 million. Tier One Capital was satisfactory at 11.3%.  Investment banking, especially bond business was up 46%, despite plans to make 1200 redundancies in that division, with corporate lending up 4%.  Wealth management was down 2% and high street banking appeared to make little progress. PPI claims are down 11% to £5.04 billion. Barclays share price has fallen 41% in the last year from 263p to 173p. This bank still plans to have cut 30,000 jobs by the end of 2018. The bonus pool is expected to be cut by 12%. At -0.34%.  The FTSE may open down 20 points.

 

 

Asian bourses are waiting on Janet and Kuroda and tended to be lack-lustre – The Nikkei closed down 0.36% and the ASX was lower by 0.63%.  The Shanghai Composite was just below the Plimsoll line at lunch and the Hang Seng lingered

 

 

UK companies posting results – Wednesday – HENDERSON, BARCLAYS, HOME RETAIL, AMEC FOSTER, GLAXO SMITHKLINE, LSE, ANTOFAGASTA, Thursday – LLOYDS BANKING GROUP, TAYLOR WIMPEY, HARVEY NASH, AGGREKO, Friday – ASTRA ZENECA, RBS, AON

US companies posting interim results – Wednesday – BGC, BOEING, UNITED TECHNOLOGIES, BOSTON SCIENTIFIC, BAKER HUGHES, GOODYEAR, PLAYPAL, FACEBOOK, DOLBY, Thursday – FORD, ZIMMER, CME, UPS, BRISTOL MYERS SQUIBB, ABBVIE, DUPONT, ALTRIA, AMGEN, GROUPON, LINKEDIN, PIXELWORKS, Friday – CHEVRON, EXXON MOBIL


Economic Data – Wednesday – UK preliminary GDP, FOMC, Thursday – US Initial Jobless Claims, Friday EU unemployment.

 

 
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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