TODAY’S FAYRE – Tuesday, 7th June 2016


In this imperfect, gloomy scene

Of complicated ill,

How rarely is a day serene,

The throbbing bosom still!

Will not a beauteous landscape bright

Or music’s soothing sound,

Console the heart, afford delight,

And throw sweet peace around?

They may; but never comfort lend

Like an accomplish’d female friend!


With such a friend the social hour

In sweetest pleasure glides;

There is in female charms a power

Which lastingly abides;

The fragrance of the blushing rose,

Its tints and splendid hue,

Will with the season decompose,

And pass as flitting dew;

On firmer ties his joys depend

Who has a faithful female friend!


As orbs revolve, and years recede

And seasons onward roll,

The fancy may on beauties feed

With discontented soul;

A thousand objects bright and far

May for a moment shine,

Yet many a sigh and many a tear

But mark their swift decline;

While lasting joys the man attend

Who has a polish’d female friend.”



The Rev. Cornelius Whur – clergyman & poet – 1782-1853.


So Dr Eva Carneiro, the former Chelsea FC doctor/physio allegedly verbally abused by Jose Mourinho, arrived in court yesterday, having refused a £1.2 million out of court settlement. She is seeking greater damages. Some of these lawyers/ advisors have a ludicrous amount of power.  What is the world coming to?  I tell you for free my employers are very welcome to verbally abuse me, sexually discriminate against me, and even if the decimal point is moved one place to the left, I will gladly take my leave!  There again, I suppose I am a ‘nobody.’ In the name of all that is wise and wonderful, madam, you are just married and you have your whole life ahead of you. Let’s hear what Jose has to say next week! With so much money in football, there is no sense of perspective!  


I have to admit I cringed to see PM Cameron on the hustings with Harriet Harmon, Tim Farron and Natalie Bennett (you might well say who? – Green Party) extolling the virtues of ‘Remain.’  I know the PM is trying to prove that he is all things to all men when it comes to getting a result from the EU referendum. That effort was surely scraping the barrel. He’s been a decent PM in difficult circumstances.  Guv’nor, don’t spoil it.


I wondered just how long it might take for Janet Yellen to put her ‘two-cents-worth’ in terms of ‘BREXIT’?  At least she was consistent with the establishment in expressing her concern that the effect of the UK leaving the EU could have global ramifications. I know she is the most powerful woman in the world and probably the 4th most powerful person in the world. Nonetheless these comments have all the hallmarks of collusion if I may say so.  George Osborne, Mark Carney and HM Treasury seems to have been hard at work!  I blame them not, but frankly I was hoping the lesson may have already been learned.  The more external interference and influence that is brought to bear, the less a great chunk of the electorate likes it!


The prophets of doom enjoyed their day briefly in the sun yesterday, as Sterling went South – though only briefly. If the country were to vote ‘out’ perhaps there may be a modest run on the Pound, but I give you a clue it will seems like a vicarage tea party in comparison to what will happen to the Euro, which could be the recipient of one hell of a larruping – a basket case if ever I saw one! Italy’s debt is unsustainable with its banking sector in tatters. France looks vulnerable to me and as for Greece’s economy, it is laughable the manner it has been kept on life support.  If there isn’t a serious bond crisis in the next 5 years I will be amazed.


In her capacity as chairman of the FED Janet Yellen still felt that a rise in rates was justifiable in the not too distant future despite really dispiriting jobs data.  Mrs Yellen leads us to believe that despite inflation remaining below 2%, it is gathering pace as is wage inflation, suggesting the underlying belly of the US economy is quite robust.  US equities digested the news with ease with the DOW ending the session up 0.64% leaving the S&P in positive territory having added 0.49%. Followers of the NASDAQ were unmoved – unchanged.  The FTSE 100 had an ebullient session with miners and the oil sector leading the way.  Anglo-American and Rio were both close to 10% to the good with Glencore not a million miles off the pace. In Asia this morning a softer Yen saw the NIKKEI adding 0.58%, with the ASX adding 0.20%. The Hang Seng had a great day on the back of improved global sentiment +1.41% and the Shanghai Composite trod water virtually unchanged.


Hoping that this missive does not become a bore I am restricting myself to commenting about 2 stories.  Firstly Mike Ashley, the retail maverick largely owner of Sports Direct, who tends to cock a snook at convention and corporate governance has finally agreed to meet Ian Wright MP, the chairman of the BIS committee and his troops today. Mr Wright is looking for an explanation or clarification on working practices at his Shirebrook factory in Derbyshire. Has he implemented the £10 million he promised to the salary bill? Were some staff already under the minimum wage approved?  Clarification will be required on short-term contracts and striking. This exchange should be fairly feisty.  Once Mr Ashley explains his operation, which I believe he will do, perhaps he will be allowed to get on with his life. I think he might even take the company back private having seen the value in the last couple of years fall from £5 billion in value to £2.28 billion – shares up 3.6% today. Ashley would be far happier not being under daily scrutiny. In passing if workers don’t like the system if it is legal, then leave!


Finally Royal Dutch Shell. 18 months ago when Ben Van Buerdon, Shell’s CEO presented the market with a deal that would mean paying £47 billion for BG Group, when oil was around $27 a barrel, many thought the CEO should be taken away by two men in white coats.  Now they will be thinking he ain’t done a bad job.  Today it was reported that annual savings have been raised from $3.5 billion to $4.5 billion. The borrowing is still too high – $70 billion.  That needs to come down and will do so when $30 billion of gas and oil assets have been disposed of (10% of joint portfolio).  However there is a bit of a queue selling assets such as the possible sale of 5% of Aramco (value $20 billion). Investors know that Shell yields about 7% and they will want a dividend maintained. Exploration will be pitched on an annual basis at between $25 and $35 billion per annum until 2020. Much of Shell’s success will based on oil heading towards $50-$60 a barrel.


UK companies posting numbers – Wednesday – Sainsbury (TS), Workspace, Boohoo, WH Smith (TS), CMC Markets, Thursday – Auto Trader, Flybe, Wincanton, Home Retail, Friday – Fuller, Smith & Turner


US companies posting interim results – Tuesday – Conn’s Inc, Wednesday – Brown-Forman, Thursday – H&R Block


Economic calendar – Tuesday – RICS House Prices, revised UK GDP, Wednesday – US manufacturing, Thursday – UK goods trade balance, US initial Jobless Claims, Friday – Consumer inflation expectations. 


David Buik
Market Commentator – Panmure Gordon & Co
+44 (0)20 7886 2775
Mobile – 0044 7788 144 877

Panmure Gordon & Co

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


Leave a Reply

Fill in your details below or click an icon to log in: Logo

You are commenting using your account. Log Out /  Change )

Google+ photo

You are commenting using your Google+ account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )


Connecting to %s

%d bloggers like this: