TODAY’S FAYRE – Tuesday, 24th January 2017
“They are waiting for me somewhere beyond Eden Rock.
My father, twenty-five, in the same suit
Of Genuine Irish Tweed, his terrier
Jack Still two years old and trembling at his feet.
My mother, twenty-three, in a sprigged dress
Drawn at the waist, ribbon in her straw hat,
Has spread the stiff white cloth over the grass.
Her hair, the colour of wheat, takes on the light.
She pours tea from a Thermos,
the milk straight From an old H.P. sauce-bottle, a screw
Of paper for a cork; slowly sets out
The same three plates, the tin cups painted blue.
The sky whitens as if lit by three suns.
My mother shades her eyes and looks my way
Over the drifted stream. My father spins
A stone along the water. Leisurely,
They beckon to me from the other bank.
I hear them call, ‘See where the stream-path is!
Crossing is not as hard as you might think.’
I had not thought that it would be like this.”
Charles Causley – schoolmaster & poet – 1917-2003
England at last salvaged some respect out of a hard fought 3 match ODI tournament in India, by winning the final game in Kolkota by 5 runs. Most of the team made a contribution with Jason Roy, Jonny Bairstow, Ben Stokes and Chris Woakes to the fore with the willow and David Willey, Jake Ball, Chris Woakes and Ben Stokes sharing the wickets under some astute captaining from Eoin Morgan. We seem rather more competitive in the sub-continent when the pitch is less conducive to spin as was the case last Sunday.
So Bernie Ecclestone, after 4 decades in formula One, at the age of 86 has been sent upstairs by the new owner Liberty Media, with Chase Carey, hired from FOX assuming the role of CEO. Like him or not you have to hand it to Bernie, in the world of F1 he is a legend and without him it may well have folded. I just loved the way he bought his way out of a bribery allegation in Germany with a quick cheque for $100 million. Who ever said money was not influential?
President Trump promised to leap out of the traps and hit the ground running on corporate issues, supporting his catch-phrase – America first! On those issues he kept his word. He, to the dismay of the world looking on, tore up the Trans Pacific Partnership Agreement. He promised measurable tax cuts for companies who manufactured goods or provided services in the US, rather than capitalise on tax efficient facilities in overseas countries. In the same breath those not complying with those requests would be met with punitive tariffs and draconian taxation.
Since the turn of the year the FTSE has dropped about 2.5% from its high point, thanks to an improvement in the fortunes of Sterling, but more to the point the gathering gloom surrounding uncertainty over President Trump’s policies, which feel more isolationist as the days roll by. Consequently we have seen evidence of a flight to quality – in other words investors have been buying bonds, awaiting more clarity on some more of Trump’s plans. We have also seen gold rally in recent sessions from $1180 to $1215 an ounce. US markets have been rather more robust with the DOW 30 points (+0.19%) to the good and the S&P an acceptable 28 points (+1.18%) and the NASDAQ (+3.1%).
Yesterday McDonald’s posted interim results with its strongest global growth in five years — despite the fact that sales in the United States fell from a year ago. The home of the Big Mac is doing extremely well in the U.K., Japan and Latin America. That helped McDonald’s post overall sales and profits that topped forecasts. Same-store sales, which measure how well restaurants open at least a year are doing, were down 1.3%. Operating profits fell too. Shares fell nearly 1% on the news. McDonald’s CEO Steve Easterbrook didn’t express much optimism about a turnaround in the first quarter either.
McDonald’s is also facing tougher competition from rivals like KFC, Taco Bell and Pizza Hut owner Yum! Brands, Burger King parent Restaurant Brands and fast casual chains like Panera and Shake Shack
Macy’s, Sears, Target, Kohl’s, and JC Penney are among the many companies that have reported lack-lustre sales during the critical holiday period. In the wake of the disappointing season, Macy’s and Sears are now collectively closing more than 200 stores, and analysts say JC Penney could shut down as many as 300 stores within the next couple years.
Target has slashed its fourth-quarter sales and earnings outlook and the mall-based retailer The Limited just shut down all 200 of its stores. This sales period seems to have been “the worst results since the recession,” according to Morgan Stanley analysts. In fact, overall holiday spending rose 4% in the US to $658.3 billion, compared to last year, according to the NRF. That number includes $122.9 billion in online sales, which jumped 12.6% over last year. Yahoo!’s interim results were a little better than expected but its $4.9 billion sale to Verizon is likely to be delayed thanks to cyber hacking.
I won’t dwell too much on weekend news though suffice to say that the Green Investment Bank may seek an IPO rather than being asset stripped by McQuarie, who had more than passing interest in buying it. Also if Spotify does not want to incur increasing interest rate charges, they better get the lead out with its proposed $8.5 billion IPO before the end of March. Weetabix, sadly will be falling in to Italian hands for $1.5 billion – Barilla. Weetabix currently has 1.3% of the cereal market against Kellogg’s 22%!
This morning we looked as though we might see a bit of a rally until it transpired that BT Group had uncovered a major accounting error in Italy – shares are down 16% as I speak. Traders are very unforgiving these days for misdemeanours. I suspect that BT’S lack of attention to its internet and broadband operation, which has been very shabby, has not helped matters. easyJet slightly disappointed thank to exchange issues where £35 million may have been surrendered from profits. Dixons Carphone made steady progress and share were up 1% at 8.10am. The FTSE 100 is currently up 9 points.
UK companies posting interim results this week – Tuesday – Crest Nicholson, PZ Cussons, IG Group, Genel, EasyJet, Dixon Carphone, Wednesday – Fresnillo, Antofagasta, Restaurant Group, WH Smith McCarthy & Stone, Thursday – Whitbread, DMGT, Diageo, Unilever, Sky, SSP, Card Factory, Rank, Kier Group, PayPoint, Great Portland Estates, Sage, Renishaw, Jimmy Choo, St James’s Place – Friday – BT Group
US companies posting interim results – Tuesday – Travellers, 3Ms. Lockheed Martin, DuPont, Corning, Johnson & Johnson, Alcoa, Texas Instruments, Wednesday – Boeing, Freeport McMoRan, AT&T, eBay, Thursday – Xlinx, Alphabet, Whirlpool, Baker Hughes, Ford, Caterpillar, Pulte, Bristol Myers Squibb, Raytheon, Biogen, Intel, Microsoft, Friday – American Airlines, Abbvie, Colgate-Palmolive, Chevron, Honeywell, General Dynamics.
Economic data posted this week – Tuesday – UK Public Sector Borrowing Requirement, Wednesday – Nationwide House Prices, Thursday – UK index of Services & BBA Mortgage approvals, Friday – US GDP estimate
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