Monthly Archives: September 2016

TODAY’S FAYRE

TODAY’S FAYRE – Friday 30th September 2016

 

 

“Ambition was my idol, which was broken

Before the shires of Sorrow, and of Pleasure;

And the two last have left me many a token

O’er which reflection may be made at leisure:

Now, like Friar Bacon’s Brazen Head, I’ve spoken,

‘Time is, Time was, Time’s past’: a chymic treasure

Is glittering Youth, which I have spent betimes-

My heart in passion, and my head on rhymes.

 

What is the end of Fame? ‘tis but to fill

A certain portion of uncertain paper:

Some liken it to climbing up a hill,

Whose summit, like all hills, is lost in vapour;

For this men write, speak, preach, and heroes kill,

And bards burn what they call their ‘ midnight taper’,

To have, when the original is dust,

A name, a wretched picture and worse bust.

 

But I, being fond of true philosophy,

Say very often to myself, ‘Alas!

All things that have been born were born to die,

And flesh ( which Death mows down to hay) is grass;

You’ve passed your youth not so unpleasantly,

And if you had it o’er again – ‘twould pass-

So thank your stars that matters are no worse,

And read your Bible, sir, and mind your purse.”

 

 

George Gordon, Lord Byron – poet – 1788-1824

 

 

All ordinary folk are absolutely astounded that our World leaders seem utterly helpless or empowered to do anything about the human atrocities in Aleppo apart from Putin, who seems to relish the turmoil.  In the past the US would have stood up and been counted.  Ever since President Obama came to office he has backed away from most global responsibilities with the US adopting an unapologetic isolationist policy. Presumably post the disasters in Iraq and Afghanistan, US voters have no stomach for continuing the fight against tyranny. Meanwhile China is growing in stature every day and Russia offers nothing but fear and confrontation, with North Korea throwing an irritating amount of fuel on the fire as it sees fit.  I doubt the world has been in a more perilous situation since the Bay of Pigs in 1961.

 

 

Let’s be cheerful about something this morning and it won’t be football.  It is ‘Arc’ day on Sunday and many hope that Roger Varion’s ‘Postponed’ piloted by Andrea Atzeni will bring the spoils back to Newmarket from Longchamps.

 

So Michael O’Leary will not agree to Willie Mullins increased training fees, resulting in the bombastic Ryanair head honcho removing Gigginstown Stud’s 60 horses from the champion trainer’s yard. Never mind, there will be more room for horses from Rich Ricci and other owners!

 

 

Yesterday we had some respite from the Deutsche Bank saga as OPEC briefly captured most of the main headlines, with its first agreed cut in production to 32,500 barrels a day for eight years – to be, of course, ratified on 30th November.   However once markets were focused on activity in New York yesterday afternoon, Deutsche Bank popped its head above the parapet like a weeping carbuncle. Deutsche shares came under attack in New York with short sellers venting their spleen taking the stock down another 6.7%.  It transpired that rumours abounded to the effect that ten of the large hedge funds were considering or had withdrawing from Deutsche Bank. What must be understood here is that Deutsche Bank is the main clearing house for trades in Europe. The problem the hedge funds have is where do they move for clearing? Short-term, they can move to New York or London. With over $60 trillion derivative book at the Deutsche Bank, the government is totally incapable of even understanding how to deal with this crisis.

 

 

Until such time as Messrs Merkel, Schauble and Weidmann step up to the plate with an unambiguous explanation, which is wholly transparent, this issue is not going away. It is ludicrous for Merkel’s mob to think that fund managers will pick up the tab for a massive rights issue without the necessary reassurance and inevitable support.  So this morning expect European markets to express their displeasure and one suspects that other financial stocks will take a beating. As I and hundreds of other commentators have been saying for over two years, European banks, in many cases, are hopelessly undercapitalised. This MUST be dealt with.

 

 

The Street of Dreams shed about one percent across the board.  The OPEC news despite the rally in oil prices became an irrelevance. Bank stocks were clattered. The FTSE 100 closed up 70 points at 6919.  I fear that much of that gain will be surrendered early on this morning. At the time of writing (6.20am), the ASX is down 0.49%, with the NIKKEI easier by 1.38%. Before lunch the Shanghai Composite was all but flat though Hong Kong’s Hang Seng was down 1.26%.

 

 

It hasn’t been a great week for banks with fines imposed on RBC in New York, north of $840 million and Wells Fargo John Stumpf held in disgrace for the bank’s misdemeanours, resulting in $41 million share options being cancelled. Commerzbank would also appear to be under the cosh with 9,600 redundancies being made with a view to cutting costs.  There was talk of a merger with Deutsche. With that news the idea seems less likely.  Oh and then of course news filtered out that Och Ziff, the US hedge fund had been fined $400 million for alleged bribery.

 

The InBev/SAB Miller £79 billion deal was finally ratified and put to bed yesterday. There was news of a possible £600 million IPO in the UK with TI Fluid Systems likely to be offered for sale on the LSE. £1.7 billion was wiped of Capita’s value yesterday – shares down 26% – on a profits warning.  This outsourcing company that collects parking fines in London etc blamed an indecisive client base, which was dithering over future plans.

 

 

Talking of the LSE and its proposed merger with Deutsche Boerse or should I say sale to, all has been agreed emphatically in London. There are no areas of disagreement apart from protestations from the likes of Lord Myners and Sir Bill Cash.  I am told they will fall on deaf ears.  If this deal does fall down it will be from regulatory issues or objections raised in Berlin or Brussels. We shall know next February.

 

 

 

 

   UK companies posting results this week – Friday – Trinity Mirror (TS)

 

 

 

 

Economic data this week – Friday – US Chicago PMI

 

 

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

 

David Buik

Market Commentator

 

D +44 (0)20 7886 2775

Panmure Gordon & Co 
One New Change | London | EC4M 9AF | United Kingdom
www.panmure.com

 

TODAY’S FAYRE

TODAY’S FAYRE – Thursday, 29th September 2016

 

“If but some vengeful god would call to me

From up the sky, and laugh: “Thou suffering thing,

Know that thy sorrow is my ecstasy,

That thy love’s loss is my hate’s profiting!” 

Then would I bear it, clench myself, and die,

Steeled by the sense of ire unmerited;

Half-eased in that a Powerfuller than I

Had willed and meted me the tears I shed.

 But not so. How arrives it joy lies slain,

And why unblooms the best hope ever sown?

Crass Casualty obstructs the sun and rain,

And dicing Time for gladness casts a moan.

These purblind Doomsters had as readily strown

Blisses about my pilgrimage as pain.

 

  Thomas Hardy – poet & author – 1840-1928

 

The Labour party faithful looked as if they were having a ball listening to the Gospel according to St Jeremy! Every pearl of wisdom and philosophical gem that dripped from his lips had a silver lining. Valhalla was to be revisited! The only problem was that he never told the delegates the cost of his pipe dreams. I suggest the outcome would be penury and eternal financial damnation.

I was not that surprised that Congress blew President Obama’s veto with added exhortations away in terms of allowing 9/11 victims being granted permission to sue Saudi Arabia – 15 out of 19 terrorists were of Saudi origin. It was the size of the majority – The Senate 97-1 and the House of Representatives 348-77. That is of landslide proportions. One of the most disturbing issues of the Obama administration is the fact that he has allowed the US to become more isolationist in terms of foreign policy and international defence, than I can ever remember, despite the fact that China and Russia are growing in stature and power by the day. I suspect Clinton or Trump will be no different.

 

The Society of Motor Manufacturers & Traders reported record turnover for 2015. Though the UK’s automotive sector has “gone from strength to strength”, the SMMT said that “the leave vote” may cause problems for the car industry. Turnover rose 7.3% in the last year to £71.6bn while jobs and vehicle production also rose. The industry now faces new challenges. Uncertainty, economic instability and an undoubted impact in terms of cost, could influence and ease of business,

The number employed in the motor industry sector rose by 17,000 to 814,000 and there was a 5% rise in vehicle production to 1.7 million in 2015, the SMMT said, and car manufacturing output is already up more than 10% so far this year.

This week equity markets have been dominated by the vagaries of Deutsche Bank and the uncertainty over its future. However this morning a perceived positive outcome to this week’s OPEC meeting has grabbed the yellow jersey from the ailing German banking titan.

Yesterday there seems to be the basis of an agreement amongst OPEC members that production would be plugged at 32.5 million barrels a day, with Iran possibly in agreement. Call me a cynic but I will believe it when I see it on 30th November when the deal is expected to be ratified, assuming that Russia, Nigeria and Libya don’t rock the boat. Anyway the net result was that crude oil rallied by 5% to $48+ a barrel and equity geeks inhaled the fumes of yet another reason to participate in a relief rally. On the Street of Dreams the three main Indices added value as follows – DOW +0.61%, S&P 500 +0.53%, NASDAQ +0.24%. Clearly energy stocks enjoyed some renaissance. There was also news from the front that Blackberry would cease to manufacture handsets. The likes of Apple and Samsung produce over 50 million a year whereas Blackberry had dropped to less than 2 million. Blackberry (aka Research in Motion as it was known) seems to be following in a similar path to Nokia, which until 10 years ago was hand-set market leader. Nokia gave up the unequal struggle and was bought by Microsoft back in 2014 for $7.17 billion.

 

Asian equities jumped on the band wagon this morning with impetus coming from the upbeat OPEC meeting – the NIKKEI closed up 1.4% and the ASX up 15. In the case of Shanghai and the Hang Seng; they were not quite so ebullient but closed 0.45 and 0.5% to the good respectively.

 

Yesterday in Europe conditions were hardly effervescent but the FTSE 100 closed up 41 points at 6849. Sainsbury’s numbers did not really pass muster – down 3.9%. ICAP was 3.6% easier. UK Mail was 43% higher as Deutsche Post closes in as a predator. RMG reacted adversely losing 3.3%. This morning the FTSE 100 joined in all the fun of the fair adding 75 points to 6925 at 11.30am. Mining was up 4%, oil stocks by an average of 5% and Utilities were also buoyant +3%. Merlin Entertainment’s figures were good but the outlook was cautious. RPC Group added 1.52% after a stellar set of numbers. This plastic manufacturing titan’s progress in its trading statement looked ahead of schedule. Pim Vervaat, the CEO looks absolutely on top of his game. This company is very well run and managed. If I was a betting man I think RPC will have FTSE 100 status by the end of 2017!

 

Final tit-bit of this morning – Viacom and CBS to merge – a rumour not to be ruled out!

UK companies posting results this week – Thursday – Euromoney, Vernalis, Merlin Entertainment, Imperial Brands, DMGT, WS Atkins. Friday – Trinity Mirror (TS)

  

Economic data this week – Thursday – UK Consumer Confidence, US GDP and US goods trade balance, Friday – US Chicago PMI

 

 

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

TODAY’S FAYRE

TODAY’S FAYRE – Thursday, 29th September 2016

 

“If but some vengeful god would call to me

From up the sky, and laugh:  “Thou suffering thing,

Know that thy sorrow is my ecstasy,

That thy love’s loss is my hate’s profiting!” 

Then would I bear it, clench myself, and die,

Steeled by the sense of ire unmerited;

Half-eased in that a Powerfuller than I

Had willed and meted me the tears I shed.

 But not so. How arrives it joy lies slain,

And why unblooms the best hope ever sown?

Crass Casualty obstructs the sun and rain,

And dicing Time for gladness casts a moan.

These purblind Doomsters had as readily strown

Blisses about my pilgrimage as pain.

 

 

 Thomas Hardy – poet & author – 1840-1928

 

The Labour party faithful looked as if they were having a ball listening to the Gospel according to St Jeremy! Every pearl of wisdom and philosophical gem that dripped from his lips had a silver lining. Valhalla was to be revisited! The only problem was that he never told the delegates the cost of his pipe dreams. I suggest the outcome would be penury and eternal financial damnation.

I was not that surprised that Congress blew President Obama’s veto with added exhortations away in terms of allowing 9/11 victims being granted permission to sue Saudi Arabia – 15 out of 19 terrorists were of Saudi origin. It was the size of the majority – The Senate 97-1 and the House of Representatives 348-77. That is of landslide proportions. One of the most disturbing issues of the Obama administration is the fact that he has allowed the US to become more isolationist in terms of foreign policy and international defence, than I can ever remember, despite the fact that China and Russia are growing in stature and power by the day. I suspect Clinton or Trump will be no different.

 

The Society of Motor Manufacturers & Traders reported record turnover for 2015. Though the UK’s automotive sector has “gone from strength to strength”, the SMMT said that “the leave vote” may cause problems for the car industry. Turnover rose 7.3% in the last year to £71.6bn while jobs and vehicle production also rose. The industry now faces new challenges. Uncertainty, economic instability and an undoubted impact in terms of cost, could influence and ease of business,

The number employed in the motor industry sector rose by 17,000 to 814,000 and there was a 5% rise in vehicle production to 1.7 million in 2015, the SMMT said, and car manufacturing output is already up more than 10% so far this year.

This week equity markets have been dominated by the vagaries of Deutsche Bank and the uncertainty over its future. However this morning a perceived positive outcome to this week’s OPEC meeting has grabbed the yellow jersey from the ailing German banking titan.

Yesterday there seems to be the basis of an agreement amongst OPEC members that production would be plugged at 32.5 million barrels a day, with Iran possibly in agreement. Call me a cynic but I will believe it when I see it on 30th November when the deal is expected to be ratified, assuming that Russia, Nigeria and Libya don’t rock the boat. Anyway the net result was that crude oil rallied by 5% to $48+ a barrel and equity geeks inhaled the fumes of yet another reason to participate in a relief rally. On the Street of Dreams the three main Indices added value as follows – DOW +0.61%, S&P 500 +0.53%, NASDAQ +0.24%. Clearly energy stocks enjoyed some renaissance. There was also news from the front that Blackberry would cease to manufacture handsets. The likes of Apple and Samsung produce over 50 million a year whereas Blackberry had dropped to less than 2 million. Blackberry (aka Research in Motion as it was known) seems to be following in a similar path to Nokia, which until 10 years ago was hand-set market leader. Nokia gave up the unequal struggle and was bought by Microsoft back in 2014 for $7.17 billion.

 

Asian equities jumped on the band wagon this morning with impetus coming from the upbeat OPEC meeting – the NIKKEI closed up 1.4% and the ASX up 15. In the case of Shanghai and the Hang Seng; they were not quite so ebullient but closed 0.45 and 0.5% to the good respectively.

 

Yesterday in Europe conditions were hardly effervescent but the FTSE 100 closed up 41 points at 6849. Sainsbury’s numbers did not really pass muster – down 3.9%. ICAP was 3.6% easier. UK Mail was 43% higher as Deutsche Post closes in as a predator. RMG reacted adversely losing 3.3%. This morning the FTSE 100 joined in all the fun of the fair adding 75 points to 6925 at 11.30am. Mining was up 4%, oil stocks by an average of 5% and Utilities were also buoyant +3%. Merlin Entertainment’s figures were good but the outlook was cautious. RPC Group added 1.52% after a stellar set of numbers. This plastic manufacturing titan’s progress in its trading statement looked ahead of schedule. Pim Vervaat, the CEO looks absolutely on top of his game. This company is very well run and managed. If I was a betting man I think RPC will have FTSE 100 status by the end of 2017!

 

Final tit-bit of this morning – Viacom and CBS to merge – a rumour not to be ruled out!

UK companies posting results this week – Thursday – Euromoney, Vernalis, Merlin Entertainment, Imperial Brands, DMGT, WS Atkins. Friday – Trinity Mirror (TS)

  

Economic data this week – Thursday – UK Consumer Confidence, US GDP and US goods trade balance, Friday – US Chicago PMI

 

 

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

MARKET UPDATE

I have no idea who won round one of the Presidential election. I think it depended on who you watched or spoke to. Some felt HR-C just about nudged it in a monosyllabic debate, lacking in any foresight or intellect. Some others believed that Trump was still ahead in the poles. Certainly the media sided with Clinton which gave markets in Asia and in Europe some momentum in the hope that there might be a relief rally. There was one but if you blinked you missed it. As over the hill the sword of Damocles appeared, in the form of Deutsche Bank and the clouds of uncertainty fell on its share price. Having been slashed by 7.5% yesterday to €10.55, today DB’S share price is down another 2% to €10.32 at 2.30pm.

 

The FTSE 100 bounced out of the traps adding 40 points but after 2 hours it did not matter 2 buttons about the Presidential election debate, it was all about Deutsche Bank and the lack of information as to its long term robustness and the terrible damage the lack of transparency was having on the banking sector, which undoubtedly affects long-term growth prospects. Yes finance for SMES is in plentiful supply but consumer banking could feel the squeeze. HSBC was up 1% today, thanks to an ‘on-going’ buy-back programme. The rest of the UK banking system was down an average of 1%. Within 2 hours the FTSE was flat and at 2.30pm the FTSE 100 had fallen 30 points at 6785, having 30 minutes before been down 48 points. The FTSE 250 was down 0.6%. There isn’t a good feel about the market, but logic has flown out of the window in very thin trading.

 

Pharmaceuticals were lower by an average of -0.5%. Tobaccos were up 0.25%. Of those companies posting results today, Wolseley was down 3.4%. Business in Europe and in the UK was patchy. Thos Cook opened up +4.5% but it has surrendered value all day and is easier by 1.5%. Close Brothers started up 4% and are also down 1.5%. Card Factory is up 2%, United Utilities +1%. AG Barr was clipped by 0.5%. Boohoo.com – having bee up 2.5% is currently flat having travelled and arrived. What a success story flagged up by Mike Stewart at 23p in May 2015 and now stand at 96p! Sainsbury posts a trading statement tomorrow – up 0.5%. If like for like sales are better than -1.5% in the last quarter, that will be taken as positive. The Street of Dreams saw the DOW add 25 points at the opening.

TODAY’S FAYRE – DEUTSCHE BANK

TODAY’S FAYRE – Tuesday, 27th September 2016

 

“As she laughed I was aware of becoming involved

in her laughter and being part of it, until her

teeth were only accidental stars with a talent

for squad-drill. I was drawn in by short gasps,

inhaled at each momentary recovery, lost finally

in the dark caverns of her throat, bruised by

the ripple of unseen muscles. An elderly waiter

with trembling hands was hurriedly spreading

a pink and white checked cloth over the rusty

green iron table, saying: “If the lady and

gentleman wish to take their tea in the garden,

if the lady and gentleman wish to take their

tea in the garden …” I decided that if the

shaking of her breasts could be stopped, some of

the fragments of the afternoon might be collected,

and I concentrated my attention with careful

subtlety to this end.”

 

  1. S. Eliot – poet & playwright – 1888-1965

 

Sam Allardyce – England Manager – what are you doing? – Just a few weeks into the job and it sounds like you are allegedly filling your boots elsewhere with more filthy lucre and at the same time talking disparagingly about the previous regime. If you weren’t just in the job, I would hope the FA would remove you forthwith on moral grounds alone!

 

Hats off to Middlesex CCC for winning the county Championship!  ‘The Three Sabres’ have been consistent all season and deserved to win! However had you watched Sky Sports coverage of the game there was only ever one county in the race – Yorkshire! I know Jason Gillespie is considered to be a cricketing icon coach and he has been brilliant for the White Rose for three years, but the presentation was hardly balanced. I thought Bairstow and Root should have played. Keeping them fresh as contracted players for Bangladesh is hardly a plausible reason.

It’s such a pity that Sir Craig Oliver, with the ink hardly having had time to dry on his investiture certificate, found it necessary to ‘dish the dirt’ in such a graceless manner so soon after the EU Referendum rout! Whilst he castigated Messrs May, Johnson and Gove for their supposed treachery, let us not forget that ‘REMAIN’S’ Referendum battle was an unmitigated disaster and you, Sir Craig, were the engine driver of this calamitous campaign! We all know that this is the best shot you will have of making some hard cash from this book – nonetheless character assassination is rarely an attractive occupational hazard!

 

ECB President Mario Draghi popped his head above the parapet in suggesting the EU play hard ball with UK over trade negotiations. Pipe down, Old Bean and attend to your Central bank issues and the crumbling EU economies. You could start with Deutsche Bank and hopefully reassure us that all is well!

 

Yesterday bourses in Europe lost between 1.2% and 2% and in the US they fell by an average of 0.9%. Why? Concern continued to prevail about banks, with Deutsche Bank very much at the top of that list. Deutsche shares fell by 7.5% to €10.55. It has recovered a smidgen this am to €10.64. I feel sorry for CEO John Cryan who inherited a hospital pass, when he stepped up to the plate in June 2016. These shares have lost significant value – down from €39 in January 2014 and €23.51 a year ago to €10.64 – down 71% and 54% respectively. Just to put some meat on the bone in July 2007 Deutsche Bank’s share price was €99.60!

 

What markets cannot cope with is uncertainty and that sensation is there in spades, with John Cryan, probably very frustrated in being able to say very little. Merkel got out her wooden spoon and stirred the pot of turmoil; in saying no official help would be forthcoming. Any rights issue will have to come from the private sector. The market needs confirmation that all is well. It is taken as read that Deutsche had greater involvement in derivative trading than any other international bank – well that is the perception. Untying that balance sheet in an unreceptive market and selling assets is difficult to achieve. There is little doubt that more capital is required. For the sake of the stability of markets DB needs to get on with it, in the hope that the contents of ‘Pandora’s Box’ are containable. Frankly I don’t believe Merkel if there is a real problem. Germany could not let DB go down. It would be a greater catastrophe than Lehman Bros. WE NEED CLARITY!

 

In 1986, outside of the US, Deutsche Bank was the finest bank in the land, respected by all. It bought Morgan Grenfell and Pember & Boyle and then added Banker’s Trust to its portfolio to make real challenges in the ‘Big Bang’ arena. Sir John Craven DB very successfully in London and the Vorstadt was brilliantly orchestrated by Rolf Breuer. Edson Mitchell’s services had been acquired from Merrill Lynch to run the investment bank and Deutsche was flying. Sadly Mitchell was killed in a plane crash when at his professional zenith, leaving a wife, family and a mistress! Josef Ackermann succeeded Breuer and was held in high esteem. But the credit crisis took its toll. He was replaced by joint CEOS – Anshu Jain and Jurgen Fitschen. That never works. Cracks, consisting of financial misdemeanours and gargantuan losses started to transpire and the rest is history!

 

The plight of Deutsche Bank could have far reaching ramifications. The banking sector took stick globally with London’s HSBC, Barclays, RBS, Lloyds and Standard Chartered shedding £23 billion in value yesterday. This is not good news for the economy. Banks in New York and Europe also suffered the slings and arrows of outrageous fortune.  

 

Other news was light yesterday with Monarch looking for investors but insisting all was well. Aldi saw sales up 12% but profits in a price war down 1.8% in the last quarter. CBOE agreed to £3.2 billion for BATS Global. Mind your eye LSE – CME and CBOE are on the march.

There were some solid results this morning – none more pleasing that Boohoo.com – flagged up in May 2015 by Panmure’s Mike Stewart at 23p – today standing at 97.5p! At the time of writing the FTSE 100 is up just 7 points having opened up +40 points.

 

UK companies posting results this week – Tuesday – AG Barr, Close Brothers, Card Factory, HIS Markit, Boohoo, United Utilities (TS), Thos Cook (TS), Mediclinic (TS), Wednesday – J Sainsbury (TS), PZ Cussons, Smiths Group, AA, Petropavlovsk, Thursday – Euromoney, Vernalis, Merlin Entertainment, Imperial Brands, DMGT, WS Atkins. Friday – Trinity Mirror (TS)

 

US companies posting results this week – Tuesday MaxCyte, Nike, Wednesday Pepsico, ConAgra, Costco.

 

Economic data this week – Tuesday UK final GDP, Thursday – UK Consumer Confidence, US GDP and US goods trade balance, Friday – US Chicago PMI

 

 

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

TODAY’S FAYRE – Sunday, 25th September 2016

 

Time present and time past

Are both perhaps present in time future

And time future contained in time past.

If all time is eternally present

All time is unredeemable.

What might have been is an abstraction

Remaining a perpetual possibility

Only in a world of speculation.

What might have been and what has been

Point to one end, which is always present.

Footfalls echo in the memory

Down the passage which we did not take

Towards the door we never opened

Into the rose-garden.

My words echo Thus, in your mind.  

But to what purpose

Disturbing the dust on a bowl of rose-leaves I do not know.

 

TS. Eliot – poet & playwright – 1888-1965

 

What a wonderful city Amsterdam is! It is cosmopolitan, friendly, quaint and characteristically beautiful around its canal system. There are 1400 bridges across the canals. Amsterdam has a population of 800,000 and there are 800,000 bicycles. Unlike the UK, few of the bikes are close to being top of the range for two reasons. Firstly, the atmosphere around this city is friendly and unambiguously lacking in aggression. They tend to ride their bikes rather than aim them like weapons, as many cyclists do in London. And secondly one bike in eight is stolen every year. 

 

I was also greatly taken with Strasbourg – a city of beauty, history and culture. Also the home of the European Court of Human Rights and the EU Parliament – so often in recent times the amphitheatre of many of Nigel Farage’s amusing and vigorous tirades against Messrs Barroso Juncker and Van Rompuy! My ‘bete-Noir’ is the European Court of Justice, which thankfully still struts its stuff in Luxembourg.

 

So Jeremy Corbyn won the Labour leadership beauty contest with a thumping majority – 61.2% of the votes cast. I would describe that as an emphatic victory. However I fear the Labour party may have tossed itself into the long grass of political oblivion. This result is not good for this country, which needs an active and effective opposition party to make the government of the day accountable. Or are many of the young starting to have a real voice in forcing Labour to lurch permanently and dangerously to the left?

 

Last Saturday week I read The Times’s Patrick Hosking’s rather gloomy but well-presented article on the outlook for global equities, aided and abetted by one of the most respected market bears, Ian Harnett, with added comments from one of the markets’ raging bulls, Hargreaves Lansdown’s Mark Dampier, who on this occasion, seemed to be suffering from post-prandial neurosis in terms of maintaining his upbeat mood of the past few months. Not that anyone cares, but you could have added me as an endorsement to that rather murky outlook

 

 

Since I set off hot foot on my river cruise last Saturday week, the FTSE has added 2.97% (just 31 points from the ‘HIGH’ this year of 6941), the DOW a rather modest 1.37%, European stocks were up by an average of 2.34% and the Nikkei a somewhat parsimonious 1.42%. I suppose in hindsight FED chairman Janet Yellen was always going to prevaricate, yet again, over a possible hike in rates. I suspect any hike will take place in December as November is all consuming with the Presidential election. Add the BOJ’S rather accommodating adjustment to monetary policy and not surprisingly global bourses fell over themselves in selecting another gear, without a care in the world. Let’s be candid! QE is the only game in town and ‘let the devil take the hindmost’ when the day of reckoning posts its invoice for professional services rendered. It may be gargantuan!

The FTSE 100’s extra special week was given added momentum thanks to further confirmation from many august bodies and some official manufacturing data that there was no, if not very little evidence, that BREXIT has damaged the UK’s economy. Even the Bank of England’s Kirstin Forbes admits that the BOE’s official negative outlook was rather more heavy-handed than it needed to have been. I purred like a Cheshire cat when I heard on Thursday that the SMMT posted data that confirmed that UK car manufacturing achieved a 14 year high in August as exports drove demand. Output increased 9.1% to 109,004 units in August compared with the same month in 2015. This Thursday’s Consumer Confidence data is likely to tell us that the shopper has not in any way lost its appetite to spend money, which in many cases it cannot afford! I hasten to add that BREXITEERS should not be smug! They must remain humble as economic cumuli economic clouds of financial concern look to be gathering in the distance.

 

As Patrick Hosking quite rightly reminded investors; most global indices had little to recommend themselves going forward. Forget BREXIT! The outlook for global GDP is not very encouraging. Corporate profits are unlikely to make a quantum leap forward this quarter and have investors finally rumbled that quantitative easing on loose monetary policy may only have limited use?

 

Most of the leading corporate stories last week that gained traction emanated from Wall Street. It transpired that the records of Yahoo! may have been hacked. As many as 500m customers may have been affected. I suspect we will hear more about this but Yahoo’s share price only came down 3%, Despite Mark Zuckerberg’s philanthropy in giving $3 billion to health development, it appears that Facebook may have overstated the value of its advertising revenue. Again the market seemed remarkably ambivalent, with Facebook’s share price easing by a very modest 1.15%. Apple’s rumoured £1.5 billion bid for McLaren has been denied. Microsoft announced a $40 billion share buy-back. It was further announced that Exxon Mobil was being investigated as to the valuation of its oil assets. Wells Fargo CEO John Stumpe was under pressure to resign last week. Two former Wells Fargo employees have filed a class action in California seeking $2.6 billion or more for workers who tried to meet aggressive sales quotas over many years, without engaging in fraud and were later demoted, forced to resign or fired. Ironically Wells Fargo share price closed up a smidgen, though it is down over 35% since its recent high of $55.97 in November 2015.

 

It has transpired that Twitter may have been the subject of takeover talks with that insatiable predator Google/Salesforce.com, which may be prepared to pay $16 billion to put another high profile social media titan in its portfolio. The Co-founder Jack Dorsey returned to Twitter’s fold, when the company’s platform was stagnating. It now only has 31 million users. However he and his co-founder Evan Williams look as if they might clean up. Twitter’s shares were up 21% on Friday in response to the potential M&A activity. However the shares have fallen nearly 40% in just under a year. In January 2014 Twitter’s shares stood at $69! – On Friday just $22.62!

 

Though UK markets girded up their loins last week with general gains across the board, investors could be forgiven for thinking this rally could be a false dawn. Oil fell 1% on the week, gold was relatively static and bond yields almost moribund. I am told trading conditions felt unreal, lacking in conviction. This week J Sainsbury posts a trading update. Whether CEO Mr Coupe has a spring in his heel to the same degree Morrison’s did 2 weeks ago remains to be seen. We will be eagerly awaiting to hear what contribution Argos will make to the bottom line and also whether the supermarket price war is adversely affecting its performance.

 

A slew of investment bankers including Barclays, UBS and Morgan Stanley aspire to bring the £10 billion IPO of a regurgitated 02 to the London market on the arm of its current owner Telefonica perhaps as early as the first quarter of 2017. It will be interesting to see what sort of an appetite investors have for yet another mobile operator in such a crowded market space. It will be no doubt down to pricing and market conditions. Tesco updates the market on 5th October. There is growing concern that Tesco’s pension black hole has doubled in recent years to £5 billion. Admittedly Tesco is a cash cow and could deal with it but at what price to shareholders? No doubt all will be revealed by CEO Dave Lewis then. Apparently the appointment of Emma Walmsley to succeed Sir Andrew Witty at GSK has not been universally well received. Many wanted an external candidate. HarbourVest’s aggressive takeover approach for SVG Group will be very well defended by Lynn Fordham’s team. This will be one to watch.

 

Ladies and Gentlemen – eyes down for a full house this coming week!

 

  UK companies posting results this week – Monday – Gemfields, MJ Gleeson, Carnival, Tuesday – AG Barr, Close Brothers, Card Factory, HIS Markit, Boohoo, United Utilities (TS), Thos Cook (TS), Mediclinic (TS), Wednesday – J Sainsbury (TS), PZ Cussons, Smiths Group, AA, Petropavlovsk, Thursday – Euromoney, Vernalis, Merlin Entertainment, Imperial Brands, DMGT, WS Atkins. Friday – Trinity Mirror (TS)

 

US companies posting results this week – Monday – Vail Resorts, Tuesday MaxCyte, Nike, Wednesday Pepsico, ConAgra, Costco.

 

Economic data this week – Monday – UK BBA mortgage applications, US New Homes, Tuesday – UK GfK Consumer Confidence, UK final GDP, Thursday – UK Consumer Confidence, US GDP and US goods trade balance, Friday – US Chicago PMI

 

 

 

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

 

David Buik

Market Commentator

 

D +44 (0)20 7886 2775

Panmure Gordon & Co  One New Change | London | EC4M 9AF | United Kingdom www.panmure.com

TODAY’S FAYRE

TODAY’S FAYRE – Friday, 16th September 2016

 

We do not wish anything to happen.

Seven years we have lived quietly,

Succeeded in avoiding notice,

Living and partly living.

There  have been oppression and luxury,

There have been poverty and licence,

There has been minor  injustice.

Yet we have gone on living,

Living and partly living.

Sometimes the corn has failed us,

Sometime the harvest is good,

One year is a year of rain,

Another a year of dryness,

One year the apples are abundant,

Another year the plums are lacking.

Yet we have gone on living,

Living and partly living.

We have kept the feasts, heard the masses,

We have brewed the beer and cider,

Gathered wood against the winter,

Talked at the corner of the fire,

Talked at the corner of streets,

Talked not always in whispers,

Living and partly living.

We have seen births, deaths and marriages,

We have  had various scandals,

We have been afflicted with taxes,

We have had laughter and gossip,

Several girls have disappeared

Unaccountably, and some not able to.

We have all had our private terrors,

Our particular shadows, our secret fears.

But now a great fear is upon us, a fear not of one but of many,

A fear like birth and death, when we see birth and death alone

In a void apart. We

Are afraid in  a fear which we cannot know, which we cannot face, which

none understands,

And our hearts are torn from us, our brains unskinned like the layers of

an onion, our selves are lost lost

In a final fear which none understands.”

 

 TS. ELIOT – poet & playwright – 1888-1965

 

US Presidential campaigns have always been great theatre even though we in the UK or in other parts of the world only view them from the peripheries.  Though the outcome will have a profound effect and possibly a terrifyingly significant influence on the global political stage, one can surely be forgiven for thinking that these two candidates leave something to be desired.  With Trump as much as 5% in the lead in a key state like Ohio a few days ago, maybe there is a much stronger protest vote against Wall Street and the establishment out there, similar to what happened in our EU Referendum vote in June, than many Americans believed. Hillary Rodham-Clinton keeps slipping on one banana skin after another with her economy of the truth. However I am told she will come with a late rattle on the rails with the Clinton team upping its game, using the well tested dissemination of “taking points” strategy.

 

I so hope that the stench of doping issues recently hovering in the direction of Sir Bradley Wiggins just turns out to be hot air. We need sporting icons without the hint of any stain on their characters.

 

I am so enjoying Middlesex being in the final mix for the county championship which will culminate with a final show down at Lord’s against Yorkshire, the reigning champions, whom I am told may be without Root and Bairstow. Both teams will also be looking over their shoulders at Somerset, which hopes to come with a rattle on the rails. This takes me back to the halcyon days of Mike Brearley in the early eighties and Mike Gatting in 1993 – memories to savour!

 

I find it hard to believe that Wall Street is so chilled out and relaxed at the prospect of having either Trump or Clinton as the 46th President of the USA.  One must surely assume that that prospect is priced in. Any positive outlook to Wall Street in the next quarter must come from next month’s 3rd quarter earnings season, M&A activity, the progress of the tech sector and from that weeping financial carbuncle – FED rate!! As regards the quality of the 3rd quarter earnings staring in October, I would not be encouraging onlookers to hold their breath in excitement. Yesterday’s data which included retail sales and PPI offered little encouragement to the idea that the US economy might be selecting another gear. The Phili-Fed and Initial Jobless claims were thankfully not discouraging.  

 

Apple’s shares rallied 3.4% on encouraging sales news of the iPhone7.. However Apple and other U.S. multinationals will face new curbs on tax loopholes under a rule imposed by Washington on Thursday, part of a scramble among governments worldwide to bolster their corporate tax bases. Acting shortly after a European Union grab for billions of dollars in back taxes from Apple, the U.S. Treasury said it was tightening restrictions on companies’ use of foreign tax credits to reduce what they owe in U.S. taxes. In the US Samsung is recalling 1 million Galaxy7s phones with battery faults

 

The DOW despite a few economic woes, kept its poise as the threat of higher rates receded – +0.99%, the S&P added 1.01% and the NASDAQ 1.47%, much of that gain courtesy of Apple. In London the two stocks that caught the imagination were Morrison and Next, both with varying success.  The former saw its shares up 5% thanks to a market improvement in sales. Next was down 2%. The Hinckley Point deal was all the rage.  The fact that we cannot afford is of little consequence as the political importance is huge.  As we are leaving the EU we need friends and the bigger the better. China ticks that box! EDF will do well. GE wants a piece of the action and will earn £1.44 billion building reactors. The major beneficiary will be UK PLC with the creation of thousands of jobs and hopefully all ‘Doubting Thomases’ will be placated over security issues.  

 

Deutsche Bank shares fell sharply in extended trading on Thursday as this bank rebuffed the idea that this claim of $14 billion against allegations of mis-selling mortgage securities after receiving an initial claim for that figure from the US Department of Justice.  Deutsche Bank shares fell in New York by as much as 7.4% after hours to $13.67, Deutsche Bank has no intention of settling these potentially gargantuan civil claims anywhere near the number cited. The negotiations are only just beginning. The bank expects that they will lead to an outcome similar to those of peer banks which have settled at materially lower amounts. However CEO John Cryan expressed a desire to settle outstanding legal claims sooner rather than later. This further wave of adverse publicity is most unwelcome.


Asia had a mixed session with the NIKKEI closing up 0.7% and the ASX up 1.08%.  After lunch the Shanghai Composite was down 0.69% with the Hang Seng on good terms with itself – up 0.63%. At 8.56am the FTSE was down 16 points.  The banks were affected by the beating Deutsche Bank too – down 6.41%.  Barclays was down 1.5%, RBS was easier by 4% and Lloyds by 1%.

 

 

Economic data this week – Friday – US Michigan Consumer Confidence

 

 

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

 

David Buik

Market Commentator

 

D +44 (0)20 7886 2775

Panmure Gordon & Co 
One New Change | London | EC4M 9AF | United Kingdom
www.panmure.com

REMEMBER! REMEMBER 15th SEPTEMBER 2008

 

REMEMBER! REMEMBER! 15th SEPTEMBER, WHEN THE US TREASURY AND THE FED CALLED TIME ON LEHMAN! LEHMAN
 
Having been in the market place for 53 years I suppose 15th September 2008 has to be the worst day in the history of banking by a country mile. Erin Callan, the FD of Lehman Brothers had been less than economical with the truth as to the robustness of Lehman’s balance sheet. Nor, as I recall, was CEO Richard Fuld as helpful to the market as he might have been. In fact it was all over for Lehman, with this bank loaded up with humungous amounts of bad sub-prime lending, little did the market know what was going to unfold! Lehman was largely regarded as the largest bond house on Wall Street. On 14th September 2007 Lehman’s share price stood at $59.50, valuing the share capital at $41 billion. When Lehman went down the share price was a derisory 21 cents. When Lehman Brothers filed for bankruptcy with $639 billion in assets and $619 billion in debt, Lehman’s bankruptcy filing was the largest in history. With the writing down of assets, losses close to $600 billion would have been incurred.
 
US Treasury Secretary Hank Paulson had been very comfortable in conjunction with FED Chairman Bernanke in getting JP Morgan to bail out Bear Stearns for $10 a share and Washington Mutual for next to nothing.  Shortly afterwards AIG was shored up with a $182 billion bail-out facility. However the moment Lehman came up with its ‘Oliver Twist begging bowl’, Paulson threw the towel in – ENOUGH he cried and that sent the biggest shock waves across the international banking system. Everyone had erroneously assumed that Paulson would come galloping over the hill like a white knight in shining armour. Consequently, all the trading banks never had a chance to ‘cross’ outstanding trades, which could have mitigated some of the gargantuan losses rather than exacerbating these losses, which the banking sector was forced to absorb.
 
Eight years on the banking sector has still not fully recovered.  Though the market is grateful for small mercies – massive quantitative easing, which bought time and restored confidence, regulation’s hob-nailed boots left their wheels of pain across the backs of every bank in the world.  It is fair to say that the restoration measures taken by the FED, US Treasury and the ‘Dodd Frank Act’ with considerable cajoling from Volcker enabled the US banking system to recover more quickly, but at a price.  The US regional bank is not as prevalent as it was; so many went by the wayside.  With the regulators all over the sector like a bad rash, banking will never be the gravy train it once was, though US banks are making a better fist of it than other parts of the world.  Regulation and capital requirements are so tough it is hard to see the kind of increase in valuations that were made in 2009/10.  Let’s face it, apart from in the US the gains made in other parts of the world have been more or less surrendered.
 
The one criticism I have, is, that the authorities have been quick to impose painful fines for transgressing banks, but no prohibitive jail sentences for the real offenders who abused their privilege. Traders and middle ranking mangers have been easy pickings for the regulator. That is not balanced justice and some senior people in very exalted positions have got away Scott-free!  There is, of course, a very fine line between reckless incompetence and fraudulent behaviour
 
I am still dramatically worried about the European banking sector. The sector is short of €300 billion of fresh capital required. Deutsche is a problem with a heavy balance sheet weighting in derivatives and capital markets. Deutsche has had problems lightening their book and selling assets.  However, whatever Merkel says about bail-outs, ‘hell has a better chance of freezing over’ than Deutsche Bank not beating the hangman, if matters became dire. I think Andrew Bailey has done a brilliant job in regulating the UK banks and though the capital requirements are penal the banks are in better shape in the UK than they are in Europe, though RBS remains an on-going carbuncle that needs lancing, but will eventually recover. Low interest rates have not helped the banks’ cause, but a zero rate policy and QE have been essential.  However that all said, the UK banking sector in terms of profitability has performed worse that US, Japan and EU thanks to the dire state of RBS huge PPI payments proportionately to much associated with Lloyds and on-going individual issues with HSBC, Lloyds, Barclays. There may not be a non-performing loan issue with UK banks, as there is perhaps in the EU, but UK bank profitability is very poor – chart & data below provided by Panmure’s chief economist Simon French. 
 
 
 
 
 
In closing BREXIT is a total red-herring. London is the most influential centre in Europe by far in terms of trading and M&A activity and having spent 70 years building infrastructure it is not going to be allowed to be usurped by Frankfurt, Paris, Dublin or anywhere else.  Negotiations will be fierce over ‘passporting’ but good sense has to prevail, however painful. London is pre-eminent at financial services – fact.  Some banks may move staff for a year or so. They will return.  Why?  London is where it is at.  Not arrogance but fact!
 
Will there be another replication of the 2008 banking crisis?  One hopes not.  However it’s the bond market that concerns me. Is the regulation of large bond operators draconian enough?
 
 
 
 

Market update & employment data

It is 14th September. The sun is still high on the yardarm and the City of London is stifling, which is far from the best remedy for the increased energy levels required to select another gear. Admittedly the news flow is almost non-existent. So market activity resembles a ‘tooth pulling session!’ Mary Magdalene would have been very comfortable on Threadneedle Street or in Canary Wharf. At 3.20pm the FTSE is up 32 points at 6698. The Street of Dreams is suffering from a similar amount of inertia resulting in the DOW gathering in just 12 points as I write.

Pharmas have been strong in London with the sector up 1.75%. Miners have been in good form – up 1% on a slightly weaker Dollar. Oils were up 1% but have eased back and remain as a sector just in positive territory after a small drop in the price of crude. HSBC bounced out of the traps despite a downgrade and is currently UP 1%. Few companies of any real consequence have posted numbers today, though Dunelm is up 0.5%. Wm Morrison and Next post trading statement tomorrow with many analysts hoping for greatly improved performances. It has been confirmed that Bayer will pay $128 a share for Monsanto with a $2 billion break-up fee in a confirmed.

There a couple of UK macro data points provided by Simon French, Panmure’s top economist: the unemployment headlines are positive but beneath the headline fall in unemployment you have weak wage growth (at a time when inflation is set to pick up) and the highest level of redundancies for 2 years. The claimant count (those claiming Job Seekers Allowance) also rose for the third month in a row. Overall a decent “Prexit” picture still prevails but there are signs of caution.

 

Secondly the CML released lending data for July – very weak with -13% MoM declines in home purchase mortgages and -19% for first time buyers and -21% for buy to let. Anecdotally the market has had a recent start to September but certainly looks like a very weak summer of lending. The area that bucked the trend was re-mortgaging, up 7% on June levels. 

TODAY’S FAYRE

TODAY’S FAYRE – Wednesday, 14th September 2016

 

“Riding home from credulous blue domes,
the dreamer reins his waking appetite
in panic at the crop of catacombs
sprung up like plague of toadstools overnight:
refectories where he reveled have become
the holstery of worms, rapacious blades
who weave within the skeleton’s white womb
a caviare decay of rich brocades.

Turning the tables of this grave gourmet,
the fiendish butler saunters in and serves
for feast the sweetest meat of hell’s chef d’ uvres:
his own pale bride upon a flaming tray:
parsleyed with elegies, she lies in state
waiting for his grace to consecrate.


 
Sylvia Plath – poet – 1932 –1963

 

 It is extraordinary that when the public’s feathers are ruffled, they react with not only great irritation but also with endless loyalty. Such was the case when it transpired that Channel 4 had trumped the BBC with an extra £10 million to secure the rights of ‘The Great British Bake-Off’ for next year’s season of programmes. Interesting that Sue and Mel are not going to join the new circus. Filthy lucre has failed to entice them up the Gray’s Inn Road. 

 

When the BBC lost out to Sky to broadcast the Open a Golf, starting at Troon this year, the viewing figures dropped by 70% on the previous year. Many more people tuned in to BBC’s recorded highlights supplemented by the wonderful gravelly comments from that ‘Peter Pan’ of golf, Peter Alliss!

The European Union is facing an existential crisis! Well there’s a surprise! President of the European commission, Jean-Claude Juncker is today expected to announce a raft of economic and security plans in the search for common ground in the wake of the British vote to leave.

 

In his address to the European parliament, Juncker will say commonality between EU member states has never been so low, with governments everywhere quicker to say what they don’t want from Brussels rather than work together. He surely cannot be surprised with the economic spoils across the region so poorly spread out and no workable immigration policy in place.  It also looks like Greece is teetering on the brink of financial disaster again.  It also does not help that Italy’s woes are testing PM Renzi and Spain having no settled government.  Finally for two pins I suspect that France, given a free vote, would be rather out than in!

 

‘Brexiteers’ and ‘Remainers’ alike have heard enough rhetoric from Messrs Davis and Fox as to how tough these trade negotiations are going to be. I think everyone would like to hear how many negotiators have been hired and who they are.  Like me, many sceptics are getting disturbed that far too many Europhiles want to play a leading role in the negotiations. No, confrontation is not the way forward, but a positive approach is essential.

 

At last we have a minister, Priti Patel, who appears to be as outraged at the staggering £12 billion that goes towards foreign aid, as millions of people in this country are! Let’s hope she has the drains up before too long.

 

Many felt that September may be a rather barren month for equity geeks and that concern is starting to look like it might be the case.  The Street of Dreams has experienced four negative sessions in the last five with FED talk of higher rates dominating the agenda.  We have also seen oil come off its best levels.  Some analysts are concerned that the third quarter earnings which will be posted in earnest in the middle of next month may not produce the increase in profits required for equities to make that quantum leap forward.  Quantitative easing is becoming a dangerous, but necessary evil, to prop up support for equities. Bond yields, though still ridiculously low, have been ticking up quite sharply in recent days with 10-year gilts yielding 0.91% and US Treasuries 1.73%.  Don’t laugh!  It is not that long ago when the respective yields were 0.65% and 1.50%! Yesterday gold eased a smidgen to $1320.24 an ounce and the cost of oil per barrel lost some ground – Nymex $45.11, Brent $47.26.

 

Against that background Wall Street yesterday surrendered an average of 1.3% on the three main indices. Oil stocks were out of favour with Chevron losing 2%. Wells Fargo sank 3.8% after Treasury Secretary Jacob Lew lambasted the bank over its bogus accounts scandal. Wells Fargo was fined $185 million by regulators. Apple was the only Dow component stock to gain, rising 2.6% after Sprint and T-Mobile reported strong orders for the new iPhone 7. Samsung Electronics advanced 4.2 percent following news it reached a deal to sell its printing business to HP Inc. for $1.05 billion.

 

Property and oils stocks were amongst the sectors that took a hit as the FTSE 100 eased by another 35 points to 6665.  Ocado’s numbers were dissected in great detail and investors were unhappy that the size of shopping orders had fallen quite sharply as well as margins coming under pressure. The fact a cash surplus of £9 million last year turned into a debt of £38 million culminated in 11% being wiped off the value of Ocado’s shares. Conversely JD Sports shares rose 4.7%.  This mews may well have stuck in the crawl of Mike Ashley for so many years the thorn in JD Sport’s side! Johnston Press recently trashed down to being no more than a penny stock rallied 70% in late trading based on rumours of talks with hedge fund Crystal Amber. Before yesterday’s surge the shares were less than 10p each!

 

Yesterday we had the warning shot across the bows on inflation with 3% likely to be the rate by the middle of next year with food likely to be the catalysts thanks to the Pound, which has fallen sharply since May 2016. Today UK employment data will be posted. The rate may tick up to 5% with jobless claims possibly falling. I doubt alarm bells will be ringing. At he time of writing the FTSE 100 is expected to open up 25 points – possibly a bear squeeze rally that should not be trusted.

 

 UK companies posting results this week – Wednesday – Alliance Pharma, Dunelm, Galliford, Martinco, Thursday – Booker, Poundland, Next, Wm Morrison, Premier Farnell, Ophir Energy, Friday – Investec

 

 

US companies posting interim results this week – Thursday -Oracle

 

 

Economic data this week –Germany ZEW, Wednesday – UK Employment data, Thursday – UK Retail Sales, MPC, Friday – US Michigan Consumer Confidence

 

 

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

 

David Buik

Market Commentator

 

D +44 (0)20 7886 2775

Panmure Gordon & Co 
One New Change | London | EC4M 9AF | United Kingdom
www.panmure.com