TODAY’S FAYRE – Friday, 6th January 2017


“All my past life is mine no more,

The flying hours are gone,

Like transitory dreams giv’n o’er,

Whose images are kept in store By memory alone.  


The time that is to come is not;

How can it then be mine?

The present moment’s all my lot;

And that, as fast as it is got,

Phyllis, is only thine.  


Then talk not of inconstancy,

False hearts, and broken vows;

If I, by miracle, can be

This live-long minute true to thee,

’Tis all that Heav’n allows.”


  John Wilmot, Earl Rochester – poet – 1647-1680


In hindsight perhaps I was a bit lippy about Sir Ivan Rogers’s resignation as EU Ambassador. However I always felt that his heart was not in BREXIT.  He had a perfect right to expose the vagaries of leaving the EU.  It was just that he is perceived to have done a terrible job negotiating UK requirements for remaining in the EU with David Cameron.  So his resignation felt like sower grapes to me and the manner of his wordy resignation damaged the PM’s reputation.  This was thought to be not good news in PM May’s hour of need.  His replacement Sir Tim Barrow seemed to attract universal approval, apart from within the Civil Service itself. News filtered out that Olly Robbins attempted to grab control for the Department of Exiting EU, but the challenge was thwarted. News of discontent seems to filter out of the Civil Service with both alacrity and indecent ease. Suggest the hatches are battened down in the months to come.

Anyway I have had my lapels tugged by people I respect about the considerable value provided by the Civil Service. The values of public servants were very much brought to my attention – Honesty, Integrity, Impartiality and Objectivity. They are not there to support or block the government’s agenda – In other words to simply provide independent advice on decisions and then implement ministerial direction.  


Most have lived through a decade where pay has been frozen, pensioner benefits watered down and they have had to deliver huge reforms. The one constant is their public service ethos which I think are unimpeachable.


Easy to say the problem is the “mandarin class” but actually it is at the most senior levels where public service is most prevalent as most Permanent Secretaries are on between £150k and £250k which given they all run FTSE100 size organisations is pitiful remuneration.


Yesterday’s session was a muddling sort of affair. Great news on car sales were posted by the SMMT yesterday with 1.3 million cars built in Old Blighty in 2016 with 77% heading for export. Last month was the 14th consecutive month of increased sales.  This has all happened despite BREXIT.  Though the export drive is under a wet sail there are signs of the domestic market is slowing down. There was also some really encouraging service sector data supplied in the wake of great manufacturing and construction data earlier in the week – the best for 17 months.  Banking, hotels, restaurants, bars, insurance are all booming here in the UK.  There are signs of inflation rearing its ugly head, but at least the BOE Chief Economist, Andy Haldane had the good grace to say the forecasting had been way short of the mark and that it had experienced its ‘Michael Fish’ moment.  What has become clear for the time being that the UK’s economy is CURRENTLY the second strongest in the Western World. However as Andy Haldane said there are still obstacles to be negotiated and he reiterated how important it was for the Government to protect the City in the forthcoming BREXIT negotiations. At the end of the day the FTSE 100 pushed its record on a smidgen to 7195 with house builders leading the modest rally. There was a downgrade for Rolls Royce resulting in the iconic engine maker easing by 4%.


On the Street of Dreams an equally sepulchral session transpired. Employment data softer than expected (ADP) saw Wall Street flat-line. Banks and retail paused for breath and ended the session easier – DOW closed -0.21%, with the S&P -0.08%. Conversely the NASDAQ added +0.20%. Investors frankly are waiting on Trump to make any clear cut policy decisions. Non-Farm Payrolls are posted at 1.30pm.  The consensus number is 183k jobs created in December 2016 against 178k in November.


As for Asia it was a much the same as the US quietly reflective.  The Yen was a little stronger taking the NIKKE down by 0.4%. The ASX closed flat and the Shanghai Composite and the Hang Seng were rudderless – -0.4% and +0.25% respectively before the close. News filtered out that Samsung’s numbers for the 3rd quarter are expected to be the best for 3 years, with profits up 50%, despite last year’s ‘fire’ debacle, which caused 1 million handsets to be withdrawn.


This morning the FTSE currently sits just above the Plimsoll line – up 3 at 7198.  Passenger numbers from easyJet for December were encouraging – up 15%. However the share price was unchanged.  Lidl, the German supermarket is building a warehouse in Bolton, creating 500 new jobs. German retail sales figures for November made very disappointing reading – down 1.8% against consensus of -1%.


One has to admire the boutique M&A operation Robey Warshaw. Only going for 3 years this very well connected and professional outfit headed by Sir Simon Robey ex Morgan Stanley and Simon Warshaw ex UBS have had their fingers in every worthwhile ‘deal pie’ in the last year – AB InBev acquisition of SAB Miller, Royal Dutch Shell’s purchase of BG Group, ARM falling to SoftBank, Aviva buying Friends Provident and WPP purchase of Chime Communications. Profits of £37 million have been declared. M&A expertise seems to be falling in to two categories – the ‘Big & beautiful’ like Goldman, JPM and UBS or the boutique, where clients get a real bang for their buck.


Economic data posted this week –Friday – Non-Farm Payrolls and 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


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