TODAY’S FAYRE – Thursday, 1st September 2016


“We came from our own country in a red room

which fell through the fields, our mother singing

our father’s name to the turn of the wheels.

My brothers cried, one of them bawling, Home,

Home, as the miles rushed back to the city,

the street, the house, the vacant rooms

where we didn’t live any more. I stared

at the eyes of a blind toy, holding its paw.


All childhood is an emigration. Some are slow,

leaving you standing, resigned, up an avenue

where no one you know stays. Others are sudden.

Your accent wrong. Corners, which seem familiar,

leading to unimagined pebble-dashed estates, big boys

eating worms and shouting words you don’t understand.

My parents’ anxiety stirred like a loose tooth

in my head. I want our own country, I said.


But then you forget, or don’t recall, or change,

and, seeing your brother swallow a slug, feel only

a skelf of shame. I remember my tongue

shedding its skin like a snake, my voice

in the classroom sounding just like the rest. Do I only think

I lost a river, culture, speech, sense of first space

and the right place? Now, Where do you come from?

strangers ask. Originally? And I hesitate.”


Carl Ann Duffy – poet laureate – 1955 –


The EU’s strange demand that Ireland claim an underpayment of E13billion of back-taxation from Apple is absurd.  If the EU is unhappy with the levy of circa 1% charged by Ireland, then enforce change in the Irish taxation system going forward not retrospectively. Again it is insensitive interference by EU bureaucratic bullying tactics to meddle in domestic issues.  The Irish government has done a brilliant job bailing itself out from the banking crisis with innovative ideas to attract overseas investments and business.  Had Ireland not done so, the rest of the EU would have had to pick up Ireland’s tab to prevent its financial destitution.


Some of the drivel perpetrated by certain members the media that PM May will use this spat between Ireland and Apple to advantageously entice Apple’s business to these shores is just nonsense. This is not the time for underhanded and maverick behaviour. The UK Government surely would not involve itself with a cheap shot of that nature.  The UK is just about to involve itself in some very tough and tricky trade negotiations. The last act of folly on Mrs May’s mind would be an act of skulduggery that could undermine the possibility of sensible pragmatic trade negotiations.


Yesterday’s meeting at Chequers produced an endorsement of the PM’s previous statement that ‘BREXIT means BREXIT’ and that the government would not wilt from its policy to control immigration.  However huge credence was also attached to a positive outcome from trade negotiations with the Eurozone. This is a pragmatic, bold and sensible approach, but will take some achieving.  The Government could use a little help from the dissenters in the Commons and certain parts of the media, but I will not be holding my breath for their support.  


Hats off to the England’s ODI team for breaking the world record score in an innings – 444 for 3 wkts (Hales 171, Buttler 90*, Root 85 and Morgan 68*) – a brilliant effort. It was a wonderful wicket to bat on, but to get a score of that magnitude even against the blind club would take some doing, let alone against a world class Pakistan attack!


When the Mail’s Quentin Letts, in reviewing Sir Kenneth Branagh’s revamping of John Osborne’s pot-boiler – ‘The Entertainer’ – did not give it a 5-star rating, I was hugely disappointed. However, having seen it last night at the Garrick Theatre, I could see what he meant.  It was not a play of our time. Take nothing away from Branagh’s performance as the seedy ‘song and dance vaudeville star’, who had fallen from grace both professionally and personally, he was at his mercurial best. There was also a wonderful cameo performance by Greta Scacchi as the hysterically inadequate wife, Phoebe.  It was a pity that John Hurt was indisposed.


However the script was terribly dated. I remember Laurence Olivier, Brenda de Banzie, Roger Livesey, Joan Plowright, Daniel Massey and Shirley Anne Field making up a wonderful cast for Tony Richardson’s film in 1960 post the 1957 National Theatre production. The Branagh production was horribly dated, However, I still maintain Sir Kenneth Branagh is finest actor in the land bar none!   


Yesterday, it felt as if those who had returned to work bodily on the Street of Dreams, had left their minds on the sea shores of the Hamptons. There were a couple real ‘shockers’ which manifested themselves on Tuesday – Hershey lost 11% in value when Mondelez pulled out of the transaction to acquire the confectioner.  Abercrombie & Fitch saw its share price slaughtered by 20% after poor interim results – no longer a darling of the fashion industry. However yesterday session on Wall Street concerned itself with falling commodity and oil prices and the aching, throbbing pain created by FED’S mind games it continues to play with the market over a possible rate hike. This forward guidance policy is becoming increasingly frustrating.  Market activists will hope that tomorrow’s payroll numbers for August, which will presumably confirm that at least 200k jobs will have been created, will be conclusive enough for the FED to act in December. Smith & Wesson post numbers today.  It is interesting to note that its share price has rallied by 53% in the last year – endorsement with the love affair that many Americans have with guns! I just cannot get over how resilient Apple’s share price has been post the EU tax demand. I suppose investors are focused on iPhone 7 due out very soon – 7th September!


Yesterday saw punters just nibble a little bit more value from the FTSE 100 as miners, which lost about 4/5% in value yesterday grabbed the yellow jersey in terms of interest. I wonder if the better China PMI data posted today might rejuvenate some interest this morning.  There were a number of contenders to fall from FTSE 100 index but the lot fell upon Berkeley Group to be replaced by Russian mining stock Polymetal!  There is a bit of irony here, as housebuilders have recovered some of the damage caused by scaremongering over BREXIT and miners are not the most vogue sector, though the recovery in the last year has been spectacular in many places. There was some encouraging housing data, which saw house prices, according to ‘Nationwide’, rise by 5.6% up from 5.2% the previous month.  We must remember that these figures are lagging.  Read my colleague, Simon French’s excellent note on the subject published yesterday. Today’s and tomorrow’s sensible post BREXIT UK PMI data is very important, though we shall need 2/3 more months of this kind of data to assess the UK’s economy properly.


There was some desperate EU employment data posted yesterday – 10.1%, with Youth unemployment in Greece at 47% and at 37% in Italy.  Spain’s level has improved but still 43% of its youth remain jobless!  I see no way out of this vortex of despair.   EU banks are in a par less state requiring fresh capital and it strikes me that the region is a basket case, with only Germany and occasionally France benefitting from a soft Euro for its export purposes.  The best news today was Deutsche Bank’s CEO John Cryan acknowledging that London will remain the financial hub of Europe if not the world. This is a totally different view than what he expressed 3 months ago!


Finally on a note of caution; it appears, partly as a result of a cut in interest rates and gilt yields that the UK pension black hole grew by £100 billion in August, taking the total to £710 billion.  It is hard to see dividends in FTSE 350 companies being maintained with such gargantuan black holes remaining. Asian stocks were mixed this AM – the ASX closed down 0.29% with the NIKKEI adding 0.23% in quiet conditions, though a weaker Yen helped the cause. Just after lunch the Shanghai Composite was down a smidgen – -0.11%, though the Hang Seng had a bit of spring in its step – up 0.78%. The FTSE is expected to gain 26 points at the opening.


UK companies posting results this week – Thursday – Hays, Stylo International, Friday – Go-Ahead Group


US companies posting results this week – Thursday – Ford (sales), Ciena, Smith & Wesson

Economic data this week – Thursday – UK PMI manufacturing, US PMI manufacturing & construction spending, Friday – UK PMI Construction Spending, US Trade Balance, US Non-farm payrolls & employment data


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


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