TODAY’S FAYRE

  TODAY’S FAYRE – Thursday, 16th February 2017

 

“The grey sea and the long black land;

And the yellow half-moon large and low;

And the startled little waves that leap

In fiery ringlets from their sleep,

As I gain the cove with pushing prow,

And quench its speed i’ the slushy sand.

 

Then a mile of warm sea-scented beach;

Three fields to cross till a farm appears;

A tap at the pane, the quick sharp scratch

And blue spurt of a lighted match,

And a voice less loud, thro’ its joys and fears,

Than the two hearts beating each to each!”

 

Robert Browning – poet – 1812-1889

 

I am sure many of you watched the BBC’S controversial production of the Shannon Matthews abduction in Dewsbury, which took place eight years ago, screened recently on television – ‘Moorside’. Though a deeply depressing subject, with huge social connotation problems, the quality of the acting was off the Richter scale – Sian Brooke, Sheridan Smith and Gemma Whelan put in mind-blowing performances of brilliance.

 

The Toshiba scandal resulting in the resignation of Chairman Shigenori Shiga has greater connotations than was superficially envisaged.  Losing a pot of money – circa a Y712.5bn (£5.01bn) write-down due to impairment charges, which would wipe out shareholder equity and drag the company to a full-year loss, is one thing, but to put nuclear power deals in Cumbria in doubt is another.  There has been a delay in posting their results, which are reputed to show a Y390bn net loss for the year ending March 31, compared with a Y460bn loss a year earlier.

 

In 2015, Toshiba twice delayed earnings announcements after it struggled to manage the fallout of a previous accounting anomaly. Toshiba has previously said it will withdraw from its nuclear plant constructions overseas, including at least a partial exit from its British venture. The firm owns a 60 per cent stake in NuGeneration, or NuGen, a British firm planning to build three nuclear reactors at the Moorside plant in Cumbria.

NuGen acknowledges that Toshiba’s review into the future of its nuclear power business outside Japan is complete and that it remains committed to developing NuGen’s Moorside Project. We shall see!

You have to smile with affection and respect at Warren Buffett and Berkshire Hathaway. On Tuesday Berkshire Hathaway’s share price hit $250,000 each up from $195k 15 months ago – up 30% and up 117% from 5 years ago when a share cost $117,000! Warren Buffett will be 87 in August and seems as smart and spry as ever. Since Trump became President, despite Buffett’s concern about President Trump’s credentials, he is alleged to have added another £12 billion of assets to his BH’S portfolio. Above all else Buffett is a pragmatist and appears to like the cut of the Presidents plans for business. Assets at BH total $552 billion and the share capital is worth $413 billion. Berkshire Hathaway employs 331k people globally and head office is in Omaha, Nebraska, the home of the great investor and philanthropist.

 

It would appear that equity markets seem totally immune to Trump vagaries and controversy. They have hung their hat on infrastructure spending, severe cuts in regulation and tax cuts – corporate from 35% to 15% in a two year span. That makes a very fizzy cocktail for fund manager, which should be good for business. There was little in the way of great corporate news apart from the fact that Verizon may pay a smidgen less for Yahoo! than was previously agreed. New York closed as follows with a YTD update –DOW: 20,611 +0.52% +4.3%, S&P: 2,349 +0.50% +4.93%, NASDAQ: 5,302 +0.59% +9.02%

 

Asian Markets performed as follows with YTD update. Conditions were sepulchral – NIKKEI 19,347 -0.47% +1.22%, HANG SENG 24,097 +0.44% +9.48%, CHINA 3,430 +0.28% +3.55%, ASX 5,816 +0.12% +2.68%. Yesterday the FTSE added 33 points to 7302 with banks leading the charge. The FTSE now has a valuation of over £400 billion and the FTSE 250 is at an all time record. Did somebody swear and say BREXIT? This morning the FTSE is down 22 points at 8.30am but Ex-Div players such as BP, Shell. Astra and Imps have taken a 29 point toll this morning. Cobham announced another profits warning and its shares fell by 18% to 110p. They stood at 240p a year ago.

UK companies posting interim results this week –  Thursday – DRAX, Coca-Cola HB, Shire Pharmaceuticals, Friday – Millennium Copthorne, Kingspan, Segro, Essentra

 

US companies posting interim results –Thursday – MGM Resorts, Wendy’s Dean Foods

 

Economic data posted this week – Thursday – Phili-Fed Index, Initial Claims, Friday – UK PSBR, UK Retail sales M/O/M

 

 

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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