TODAY’S FAYRE – cricket, Trump, Le Pen, May, Farage & markets

 

TODAY’S FAYRE – Tuesday 22nd November 2016  

 

“I am made all things to all men–

Hebrew, Roman, and Greek–

In each one’s tongue I speak,

Suiting to each my word,

That some may be drawn to the Lord!  

 

I am made all things to all men–

In City or Wilderness Praising the crafts they profess

That some may be drawn to the Lord–

By any means to my Lord!  

Since I was overcome By that great Light and Word,

 

I have forgot or forgone

The self men call their own

(Being made all things to all men)

So that I might save some At such small price, to the Lord,

As being all things to all men.  

 

I was made all things to all men,

But now my course is done– And now is my reward…

Ah, Christ, when I stand at Thy Throne

With those I have drawn to the Lord,

Restore me myself again!”        

 

Rudyard Kipling – poet & author – 1865-1936    

 

I wasn’t as downcast over England’s annihilation in the last test match by India at the hand of their excellent and experienced spinners in their own back yard!  A fair bit of resolution was shown by our batsmen in terms of patience.  However, at times the wicket was all but unplayable.  It was a great toss to win and Kohli, Pujara, Rahane and Ashwin capitalised on their luck and batted brilliantly. I fear England’s middle order is very brittle. I find it hard to fathom why the selectors did not select Ian Bell for this series – a great player of spin bowling!

What an achievement by Andy Murray – indisputably No: 1 tennis player in the world having won his last 24 matches on the bounce.  His performance at the 02 was mega – of iconic proportions – a fantastic achievement. Indisputably SPOTY on 18th December 2016.   I must confess reading informed rumour that Tony Blair was on the comeback trail by massing supporters to block BREXIT, aided and abetted  by George Osborne and no doubt Lord Mandelson, rocked me back on my heals. Word on the Street has it that he is looking for offices in Westminster. I hope talk of that nature is just rumour. It was all I could do not to fall about with derision and laughter at the thought of Mr Blair rising like the phoenix from the political ashes. He cannot be serious. He and the likes of Sturgeon, Clegg and ‘Little Timmy’ must accept the will of the people. If PM May loses her appeal in the high court there is nothing any one can do but accept the ruling that the proposed legislation must be discussed and approved by Parliament.  We do not need the like of Blair to duplicitously block or delay the implementation of Article 50.

Implementing BREXIT looks as if it is going to prove to be very difficult.  In the same manner that Churchill put together a war cabinet to win the war, Mrs May should put a Cabinet together that is TOTALLY focused on BREXIT as its number one priority.  It must be ‘all hands to the pump’ with a view to making trade agreements as quickly and as painlessly as possible.  It’s the delay and uncertainty that will damage the UK’s economy, not BREXIT itself.

 

I was amused to read Gideon Rachman’s headline in his FT column – “Le Pen looms over the Trump Era” – He better believe it. Marine Le Pen is nothing like as extreme in her views as her father. She will take Francois Fillon all the way down to the wire. Though France is an extremely conservative country, ‘establishment’ politics seems to be taking a back seat across the globe these days! She’s in with a great shout and No! I am not an extremist – just a realist!

 

Though PM May is no extrovert and is not as comfortable on her pins as David Cameron was, I must come to her defence over the deafening silence in regards to BREXIT plans. When the FT, Times, Guardian, Evening Standard, Independent, Mirror and most of the TV operators are hostile to the idea of BREXIT to the point of holding people like me in wholesale contempt as if we were monosyllabic congenital throwbacks for the decision 17.4 million of us made in wishing to leave the EU, she has every right to be very reserved on commenting until she has all her ducks in a row. No one, regardless of political persuasion, can possibly expect the PM to drip feed the media with the scraps from Lazarus’s table with most of the press looking to tear some of these ideas to pieces like raw meat. Many of her Cabinet do not have their heart in delivering BREXIT including Mrs May; so she is spot on insisting that the world waits until she is good and ready! Finally on BREXIT, there is no doubt that the decision to leave the EU would never have been made without Nigel Farage. Much as I admire his fortitude, he has shown nothing but wholesale contempt for the Government and the Conservative party. So regardless of Mr Trump’s suggestion, Mrs May would look very weak were she to pander to Mr Trump’s suggestion.

 

If President-Elect Trump really does pull the plug on TPP, that may be a very significant statement and could start to open the doors for free trade agreements. Hopefully it could prevent the EU from being so truculent and uncooperative in dealing with the UK at the latter day of BREXIT judgement.

 

Yesterday all 4 main indices reached record levels – the DOW, S&P 500, NASDAQ and the Russell, with most punters believing that any future measurable gains will be made courtesy of the latter. SMES is where the growth is and stock selection is of paramount importance both in the US and in the FTSE 350 and AIM markets. The DOW closed +0.47%, with the S&P 500 up by 0.75% and the NASDAQ better by a measurable 0.89%. Energy stocks were on a roll with an average of a 2% gain, which gave some momentum to the rest of the market place.

 

In London the FTSE 100 trod water but there were some interesting movements with specialised mining companies making some gains, as oil rallied on the possibility of an OPEC production agreement. Employment agencies such as Hays and Page also performed with zest. Sky was still on the drift easing by another 2% with sport contracts looking uncertain. Lloyds Banking Group (share price 60p – 73p breakeven) posted the excellent news that the taxpayer had been relieved of another 1% of its stake to 7.99% down from a high of 43%. Also yesterday Lloyds threw its hat in the ring as a buyer of BOA’S MBNA credit card business for $7 billion as an alternative suitor to Cerebos. This business looks synergistic, provided the bank can agree a ceiling over PPI claims. With low interest rates likely to prevail for some time, Lloyds needs earnings growth, being a ‘plain vanilla’ bank with no investment banking revenue. Lloyds knows all about PPI having shelled out £16 billion back to its customers.

 

Finally Facebook will increase its footprint in London by 500 people next year bringing the total to 2000. A slew of companies posted results today with Kingfisher posting numbers in line but a great contribution from ScrewFix sales up 23% in the last quarter. AO World and De La Rue also caught the eye with improved numbers. Lavendon’s share price rattled up by 40%, thanks to a hostile bid from the Belgian operator TVH Groupe. The FTSE 100 is 50 points to the good at 9.07am.

 

In Asia the mood was positive with the NIKKEI closing up 0.3% – incidentally up 20% since June 2016 – and the ASX closing in good shape – up 1.1%. Just after lunch the Shanghai Composite was 1% to the good and the Hang Seng was purring – +1.5%.

 

UK companies posting numbers this week –  Tuesday – De La Rue, Intertek, HomeServe, Compass Group, Babcock International, Mitchells & Butler, Telecom Plus, AO World, Kingfisher, Spirax-Sarco, Wednesday – Thos Cook, United Utilities  Thursday – Countrywide, PayPoint, Caledonia Investments, Marston’s, Severn Trent, Pets at Home, HSS Hire, Mothercare, Friday – Pennon 

 

US Companies posting interim results today – Tuesday – Urban Outfitters, Campbell Soups, Dollar Tree, Hewlett-Packard

    Economic data this week –  Tuesday – US Existing Home Sales, Wednesday – FOMC Meeting, ECB Financial Stability Review, Thursday – Gfk UK Consumer Confidence, US Initial Jobless Claims, Friday – University of 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

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