TODAY’S FAYRE – Thursday 3rd November 2016


“The groundhog on the mountain did not run

But fatly scuttled into the splayed fern

And faced me, back to a ledge of dirt, to rattle

Her sallow rodent teeth like castanets

Against my leaning down, would not exchange

For that wary clatter sound or gesture

Of love : claws braced, at bay, my currency not hers.


Such meetings never occur in marchen

Where love-met groundhogs love one in return,

Where straight talk is the rule, whether warm or hostile,

Which no gruff animal misinterprets.

From what grace am I fallen.

Tongues are strange, Signs say nothing.

The falcon who spoke clear

To Canacee cries gibberish to coarsened ears.”


Sylvia Plath – poet – 1932- 1963


 Thousands of people would have shrieked with delight at the PM’s support of England and Scotland football teams wearing poppies on their strip for next week’s World Cup qualifier. Mrs May is ‘spot on’ in saying to FIFA – Get your own house in order before telling us how to remember the ‘fallen!’

Any miniscule amount of sympathy Sir Philip and Lady Green might have been accorded for technical reasons by the general public on the legal validity or responsibility they and Taveta Investments had in responding to the BHS pension ‘Black Hole’, has forever flown the nest! Even if, by presumably force-majeure, Sir Philip steps up to the plate with a begrudging cheque of considerable substance, it will be perceived that he has not paid up with a good grace.

Clearly Lesley Titcomb the CEO of the Pension Regulator has had more than enough of the Green/Chappell stalling tactics after a four month holiday under the gin clear skies of the Cote D’Azur. Enough is enough. There may well have been meetings in this period, but clearly not conclusive enough. What is worrying is that even if he eventually comes up with a figure, the existing 20,000 pensioners may have already been severely and irrevocably damaged. Maybe, because of his stance that he has done nothing wrong from a legal perspective, he frankly does not care what people think. The removal of his knighthood is far from done and dusted! He has not broken the law.


‘Trumpitis’ is fast becoming a debilitating condition of epidemic proportions that has settled with some discomfort in beautiful downtown Manhattan. US markets have experienced seven successive losing sessions – the longest negative run for 5 years. This is entirely a sentiment play, rather than any creeping paralysis of bad corporate or economic news. There seems in many respect evidence of a creeping paralysis – the sort of drip, drip feed downwards – nothing violent, but very steady! Yesterday the three main US indices surrendered an average of 0.5% in value. The comments by FED Chairman Yellen post the FOMC meeting suggests that a hike of 25 basis points in the FED rate in December is probably on schedule, barring unforeseen problems or issues.


Facebook was the stock under the microscope yesterday. Mark Zuckerberg’s ingenious invention, which boasts over 1 billion users, posted blockbuster growth. However, advertising revenues, one of the main drivers of its expansion, could taper off next year. That comment was enough to take the shares down by 7% after hours. The social media titan posted EPS of $109 against expectations of 97 cents on $7.01 billion of revenue. In the last quarter Facebook accessed 1.79 billion people (+16%). Time Warner shares closed flat yesterday after the media and entertainment conglomerate reported quarterly earnings and revenue that beat analysts’ expectations. After all it is less than two weeks since the announcement of a merger with AT&T. The media titan reported third-quarter earnings of $1.83 per share on revenue of $7.2 billion.


There were a slew of earnings today with Inmarsat grabbing the Yellow jersey for a stunning set of numbers, which hopefully has triggered a renaissance – up 11% at 8.30am. Wm Morrison’s numbers were always going to be good – like for like sales up 3.4% ex-fuel and overall sales including fuel up 1.6% in the past 13 weeks. The reaction to its share price was neutral – not really that surprising as they have rallied under Dave Potts’s dynamic leadership by 58% since December 2015. Glencore production figures were in line. Again the share price has already recovered dramatically. Having hit a low of 70p fourteen months ago, Glencore’s shares stand at 244p – up 248% – hardly shabby! Stephen Hester, CEO of RSA, will have been pleased with his results. Again shares have done well in the last year – up 32%!


Finally it is super Thursday with the Inflation Report being posted in conjunction with the findings of the MPC this morning. In the wake of Mark Carney’s announcement that he will remain in situ until 2019, one wonders if he will be plagued by questions as to why he won’t stay until 2021. Personal consideration will be his response, but I wonder? The BOE will need to adjust its GDP for this year and next in an upwardly direction – It is likely that GDP will be 2.2%-2.3% in 2016 and perhaps above 0.8%, the BOE’S last assessment in 2017. 1.2% as an upward adjustment does not seem unreasonable in the wake of good PMI numbers this week. There will be no change in rates at 0.25% – Rates remained at 0.5% from March 2009 until June of this year. However the threat of 4% inflation by Q4 in 2017 ventures to suggest that the odd hawk may bear his/her teeth early in 2017 – maybe Kirstin Forbes! I suspect that Mark Carney will be weeping and knashing his teeth over the UK’s dire economic outlook for 2018/9. My good friend Simon French, Panmure excellent economist, will put more meat on the bone later in the day.


UK companies posting results this week – Thursday – Inmarsat Wm Morrison, Glencore, Tate & Lyle, Randgold, RSA, Friday – Paddy Power Betfair, Informa

 US companies posting interim results this week – Thursday – Costco, Cigna, Hyatt Hotels, Kraft Heinz, Met-life

Economic data this week – Thursday – UK PME Services, Inflation Report, MPC meeting, Friday – Non-Farm payrolls & employment data in US



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

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