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



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