TODAY’S FAYRE – Sunday, 26th February 2017


The usual boredom of patrols.

The endless orbiting at twenty grand;

The growing pins and needles in the arse,

The endlessness of time, the crawling clock,

And nothing to relieve monotony.

The necessary plague of oxygen,

The routine checks of fuel, pressures, temperatures,

Oil, coolant guns-

(as if there is any chance of using them!)-

Browned off with looking round, above, behind,

Conducive to no rational thought or act

But the conditioned reflexes of fear.


The ships below, sculling like water-beetles on a pond

In white-tracked zig-zags, escorts on the flank.

And the careful, modulated tones

Of the directing officer: ‘Steer One Fife Eight!’

Bogey at fifteen miles.’ Turn onto course-

Another bloody Sunderland for sure.

And still half-an –hour to go. ‘Blue two-

Open to five. And keep a good watch out.’


Last time – an 88 it was – above the fleet;

We picked him up at dusk at thirteen grand,

Chased him as he dived into the dusk:

Somebody hit him, saw the bits come off.

Then the last light went. We lost him

To the eastward, going like hell

Right down on the drink. And can those pockers go.

We only got a probable for him. He might

Have made it home. Not the clean, concise

Explosion of the bastard that you jump,

Two quick sure bursts –and there an end.


But here, the mainland a dim shadow

In the haze, there’s not much chance.

‘Blue two: we’ll start going down, I think’-

Blow out your ears and spiral down. Thank God,

The bar should be open when we land.”


Philip Larkin– poet – 1922-1985


It was wonderful to see Scotland play to their full potential by beating Wales 29-13.  Considering Wales dominated possession, Scotland showed how much flare their backs have, with Finn Russell dictating affairs with guile and aplomb.  However I suspect Ireland will prove the greatest threat to England’s 6-Nations championship aspirations.  With Johnny Sexton restored to Ireland’s ranks, the boys in green gave a clinical account of themselves in disposing with a very physical French team at the Aviva by 19-9.


Before shipping out from being Deputy Governor of Bank of England responsible for markets to the London School of Economics, Dame Minouche Shafik has sent a veiled but courteous reminder or threat to Chancellor Philip Hammond not, under any circumstances to relax banking regulation, as President Trump is proposing. She was also warning against making the UK in to a low-tax business environment for multi-nationals, as a precaution to meet a potentially hostile reaction from the EU against BREXIT.


US Treasury Secretary Steve Mnuchin seemed to wake from his slumber last week. He commented on the strength of the Dollar and his dislike of China’s ability to manipulate its currency almost with impunity. However what he and the Trump administration failed to do was to establish a plan for introducing their tax cutting or infrastructure spending. Though US stock markets established new records early last week, by Friday market professionals and traders were sending out signals to the effect that they were losing some confidence that these wide-ranging and far-reaching changes would be delivered quickly enough. It is essential they are to justify the measurable bounce US equities have enjoyed since 8th November 2017. Also political populism is unsurprisingly starting to leave a very strong footprint across the European Union with Holland’s right wing candidate Wilders and France’s Le Pen gathering quiet support, with discontent boiling over in Italy and Greece.  Those who do not think that these issues have any significance to EU unity and its economy delude themselves. However European equity funds attracted the largest weekly inflows in more than a year as institutional investors staked a recovery with funds valued at E1.1 billion. Retail investors were not as ebullient about life as several lightened up their portfolios. There has also been a rise in the sale of gold assets by the UK to countries like China.  There is a school of thought that believes that these sales may have distorted the UK’S positive export and trade figures. Gold rallied last week to $1256 an ounce and with investors’ appetite for risk in equities diminishing smidgen, the natural correlation was for bond yields to ease and they did.


The net movement of the major global indices was far from dramatic, last week, but there was a feeling that investors needed a bit more encouragement to remain on board as committed bulls. The S&P 500 finished the week in record territory – +0.87%.  The FTSE lost a little shine and eased by 0.77%, much of it down to poor results from HSBC, Standard Chartered Bank and RBS. European stocks just lost a thin layer of recently acquired cream – -011% and the Nikkei finished the week above the Plimsoll line – +0.25%. Much has been written on the banking results last week.  Suffice to say that RBS posted its ninth loss in succession – £6.9 billion – making a total of over £100 billion, if the £45 billion bailout by the taxpayer is included in the total of annual losses of £58 billion. CEO Ross McEwan says the bank will be in profit by 2018, though it is hard under the current circumstances to visualise that happening.  However in fairness the trading profit for the year was £4 billion. A large cumuli nimbus cloud in the form of a multi-billion Dollar fine for miss-selling mortgage backed securities of $3.5 billion+ remains an uncomfortable imponderable.  


In hindsight, had we known what we know today perhaps RBS should have been split in to a good bank and a bad one.  RBS, NatWest, Coutts and Ulster are decent brand names and perhaps their recovery time might not have been so hindered. There is no doubt that Standard Chartered’s CEO Bill Winters has had the drains up and thrown the kitchen sink at this bank.  However results were disappointing on Friday with no dividend.  Initially shares fell by 5% on Friday but closed the session down 2.7%. However it should not be forgotten that Standard Chartered’s share price has risen from 430p to 723p in the last year – UP 68% and the UK’s main banks apart from RBS have added over 20% in value since US Election day on 8th November.  Finally on banks, the major hedge fund owners are running out of patience with the Cooperative Bank, which may not be able to meet its capital requirements.  Management changes may be made to stave off pressure from the Bank of England to close or sell.


Last week on the Street of Dreams much of the emphasis was on retail, where efforts by Wal-Mart, Home Depot, Nordstrom and Macy’s  passed muster.  Hewlett-Packard from the tech sector failed to live up to expectation and on Thursday its shares eased by 6%. On Friday JC Penney did not please their acolytes and shares fell by 5.8%, but Foot Locker blazed the trail adding 9.38%!


Having successfully staved off the aggressive overtures from Kraft Heinz, Unilever has quickly regrouped and is looking very carefully at a strategic plan to break the company up, hiving off its food business in to a £30 billion operation, which could include, Hellman’s Knorr, Ben & Jerry’s etc. It is thought that Unilever’s main 14 fund manager investors which include Warren Buffett’s Berkshire Hathaway and 3-G Capital would approve of such a move, as greater shareholder value would be delivered.  


UK companies posting interim results this week –  Dechra Pharmaceutical, Bunzl, Trinity Mirror, Persimmon, Hiscox, Keller, MJ Gleeson Tuesday – Meggitt, Laird, Interserve, Jardine, Lloyd Thompson, GKN, Direct Line, Provident Financial, St James’s Place, Taylor Wimpey, Moneysupermarket, Fresnillo, Go-Ahead, Babcock International, Wednesday – Elementis, ITV, Evraz, Carillion, Admiral, Man Group, Inchcape Thursday – Spirent Communications, Capita, Travis Perkins, Melrose, Vesuvius, RPS, Merlin Entertainment, Schroders, Johnson Matthey, Cobham, Friday – STV Group, London Stock Exchange, WPP

US companies posting numbers this week – Saturday – Berkshire Hathaway, Monday – Sotheby’s, Tuesday – Target, Autozone, Liberty Media, Taser, Ross Stores, Wednesday – Dollar Tree, Shake Shack, Thursday – Fred’s, Abercrombie & Fitch, Barnes & Noble, Costco


 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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