Monthly Archives: July 2017

PASSCHENDAELE – POEMS – 1917

TODAY’S FAYRE – Monday, 31st July 2017

“SQUIRE nagged and bullied till I went to fight,
(Under Lord Derby’s Scheme). I died in hell—
(They called it Passchendaele). My wound was slight,
And I was hobbling back; and then a shell
Burst slick upon the duck-boards: so I fell       
Into the bottomless mud, and lost the light.
At sermon-time, while Squire is in his pew,
He gives my gilded name a thoughtful stare:
For, though low down upon the list, I’m there;
‘In proud and glorious memory’ … that’s my due.   
Two bleeding years I fought in France, for Squire:
I suffered anguish that he’s never guessed.
Once I came home on leave: and then went west…
What greater glory could a man desire?”

 

In fifty years, when peace outshines

Remembrance of the battle lines,

Adventurous lads will sigh and cast

Proud looks upon the plundered past.

On summer morn or winter’s night,

Their hearts will kindle for the fight,

Reading a snatch of soldier-song,

Savage and jaunty, fierce and strong;

And through the angry marching rhymes

Of blind regret and haggard mirth,

They’ll envy us the dazzling times

When sacrifice absolved our earth.

 

Some ancient man with silver locks

Will lift his weary face to say:

‘War was a fiend who stopped our clocks

Although we met him grim and gay.’

And then he’ll speak of Haig’s last drive,

Marvelling that any came alive

Out of the shambles that men built

And smashed, to cleanse the world of guilt.

But the boys, with grin and sidelong glance,

Will think, ‘Poor grandad’s day is done.’

And dream of lads who fought in France

And lived in time to share the fun.”

 

 

 

Siegfried Sassoon – soldier & poet – 1886-1967

 

RIP

 

 

 

UK companies posting numbers this week – Monday – HSBC, Fidessa, Keller Group, Senior, Tuesday – Centrica, Taylor Wimpey, SDL, Man Group, Rolls Royce, Greggs, Direct Line, Meggitt, BP, Greggs, Genel, NWF Group, Filtronic, International Game Technology, Wednesday – Rio Tinto, Dignity, Travis Perkins, Aggreko, BAE Systems, Johnston Press, RSA Group, William Hill, StatPro, Standard Chartered Bank, Thursday – Cobham, Mondi, Serco, Shire, Inmarsat, eSure, LSE, Spirent, Portmeirion, Friday – RPS Group, Pearson, Aon, Royal Bank of Scotland, Merlin Entertainment, Millennium Copthorne,

 

 

 

    US companies posting results this week – Monday – Loew’s, Tuesday – Xerox, Pitney-Bowes, Sprint, Pfizer – Wednesday – Groupon, Time Warner, Metlife, Tesla, Zynga, Thursday – Aetna, Allergan, Yum Brands!, Kraft Heinz, Viacom, Friday – Revlon, Calgon Carbon

 

    Economic Data – Monday – UK Mortgage approvals, Tuesday – Tuesday, UK PMI Manufacturing, Wednesday – UK PMI Construction, Wednesday – UK PMI Services, MPC Meeting, Friday – US Non-farm Payrolls & 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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TODAY’S FAYRE

TODAY’S FAYRE – Sunday, 30th July 2017

 

 

Here is the hard-bitten country of my birth.
In a dank corner between monkey-puzzle and sawpit
Lived, drunken Dick Spargo: how he made a living
I’ve often wondered – occasional cattle-dealing
And his wife’s bit of property, I suppose.
Fridays he’d come rolling home from market,
His breeches as tight, and every variety
Of knobbly stick or cane or switch to brandish,
Long moustaches dripping booze at ends. […]
Higher and higher, mount the last heave of the hill
To where the china-clay country begins:
The pyramids rise pure in colour and line,
On the other hand, the chasms torn in the earth
Vertiginously deep and frightening. […]
The road runs downwards now through china-clay
Villages with ancient rebarbative names:
Scredda, Rescorla, Hallaze and Stenalees,
A hog’s spine of hill mounding the western sky,
Carluddon, Carloggas and Resugga Green,
Penwithick Stents and Treverbyn vean, a tree
Or two in a hollow by the cemetery.
The view to the right across prehistoric moors,
Full of crosses, quoits and standing stones,
Circles and monoliths and dead men’s bones,
To Luxulyan tower suddenly lit by the sun. […]
Enter the last lap, a shallow valley
Of settling-pools, clay-dries and small farms,
Tall chimneys punctuate the tilted slope
To where at the top of the immense, frowning Rock
Of the medieval hermit looms and threatens,
Broken arch of chapel an eyehole at summit,
The eye of a needle the rich may not enter…
Down the descent by cobwalled Rock Inn
To the sombre garden where my ancient friend awaits me,
Eyes as blue as periwinkle in the border,
A rich and warm expressive Cornish voice,
With the crackle in it like foot on autumn leaves,
Smile like the early April sun coming out
Among windswept daffodils, their heads blown,
Spilled cups of gold upon clumps of heather
In this rockbound moorland fastness hemmed about
By all the temerarious flowers of spring.”

 

 

AL Rouse – historian & poet – 1903-1997

 

I paid a memorable visit to Ascot on Saturday. Prince Khalid Abdullah’s ‘Enable’, trained by John Gosden, is probably the best filly we have had in this country since ‘Ouija Board’, ‘Bosra Sham’ and ‘Oh So Sharp.’ She was a very worthy winner of the King George & Queen Elizabeth Stakes in fairly challenging conditions and awful weather.  I know she had the filly’s allowance, but no one really got a blow in, though Sir Michael Stoute’s ‘Ulysses’ ran a great race, beaten two lengths.  Surely her next stop is L’Arc de Triomphe on the first Sunday in October.  She must have an outstanding chance, is she gets there in good shape, without coming in to season.

 

Considering the sun is high on the yardarm, with holiday makers setting off ‘hot-foot’ to the French Riviera, the Costa del Crime, the Hamptons, Martha’s Vineyard or Rock in Cornwall, there was plenty of corporate news to keep punters and analysts on their toes last week. Starting in the US it was a huge week for technology, Solid Microsoft results pleased its acolytes last Friday week with Facebook posting revenue up 45% with profits up 71% last quarter, resulting in its shares rallying by 4% after hours on Wednesday (34%) for the year. Twitter has made little progress and its shares were larruped – down 14% on news of CEO Jack Dorney’s dispiriting news. The market held its breath as Jeff Bezos, CEO of Amazon (business started in 1995 and posted losses for 18 years!) went to the rostrum with the latest quarter’s results.  They were not as expected.  Though earnings were gargantuan $38 billion with sales up 25%, profits were down 77%.  Amazon is incurring huge expenditure such as taking on Netflix in its own backyard.  It will take time for these expansion plans to turn in to profit.

 

For 24 hours Amazon and Jeff Bezos had their day in the sun.  Briefly Amazon’s capital value breached through $500 billion threshold, though still behind Apple ($796 billion) and Alphabet ($664 billion) – an incredible achievement.  At the same time Jeff Bezos for a day was the richest man in the world – $91 billion with Bill Gates at $90 billion.  On Friday they flip-flopped as Amazon’s shares shed circa 3%. McDonald’s cracked on with the likes of Boeing, Caterpillar and Merck delivering the goods, with Intel on Friday posting a solid performance. Starbucks did not pass muster (shares down 9.2%); nor did Altria for reasons slightly beyond their control. The strength of nicotine has become a major issue with the FDA. Altria’s shares fell 9.4%.

 

Altria was not the only tobacco titan to suffer a battering.  Such was the case of BATS – down 6.8%, having been down 11% mid-morning and Imperial Brands, down 3.7% on Friday. And then, of course, there was the unfortunate plight of Astra Zeneca, whose share price fell 15% on news that Infinzi had failed to pass muster with the drug regulator and this fact exasperated expectations for Mystic, AZ’S lung cancer treatment which will hopefully replace chemotherapy one day. Many believe the visceral treatment of AZ’S share price was unwarranted and maybe overdone. 

 

It was also the start of the bank reporting season in London, with Lloyds stepping up to the plate on Thursday and Barclays on Friday. Both have cleaner balance sheets than before. However both are still continuing to be plagued by PPI claims. Both have had to make provision for another £700 million. However with the claims end date now agreed for spring 2018, perhaps there is light at the end of the tunnel. PPI claims have been almost as damaging as sub-prime lending and its derivatives coupled with poor credit decisions that plagued the 2008/9 banking crisis. PPI has cost Lloyds and Barclays £17 billion and £9 billion respectively. Barclays’ CEO Jes Staley says that the ‘Bald-Eagle’ has finished with restructuring. In line with other banks involved in investment banking Barclays saw its revenue down by 20% in the last half year. A one-off impairment of £1.2 billion was incurred in selling its African operation. No comment was made about the Qatar capital raising exercise or his personal issues with the FCA in regards to whistle-blowing!

 

There were also top efforts from IAG with profits up 37% and a real recovery effort from Ladbrokes Coral. However the market expressed its concern over the treatment of interest by Virgin Money. The headline numbers were good, but the market took the shares down by 8% on Tuesday but the stocks was only down 3.5% on the week. Royal Dutch Shell seems to have digested the £47 billion acquisition of BG and is well on the way to divesting itself on $30 billion of non-core assets. At the end of the week the S&P 500 finished just below the Plimsoll line – down 0.11%.  The FTSE was 1.1% lower, which was not a bad effort considering what happened to tobacco and drug sectors. Euro stocks remained in the doldrums – down 0.4% despite very good numbers from UBS and an improved effort by Deutsche Bank.

 

UK GDP for the second quarter came in at a slower rate than many hoped for – +0.3%.  This was lower than Germany 0.6%, France 0.5% and Spain 0.4%. However it should not be forgotten that our EU neighbours have improved from a much lower base than the UK has. Centrica may well have kept it promise not to raise tariffs, but this will affect profits, when it posts numbers on Tuesday. It is nine years since RBS had its disastrous £12 billion rights issue prior to Fred Goodwin and his colleagues dived in to the vortex of despair in buying ABN AMRO for £26 billion. It has just paid £4.2 billion to the US regulator for bond miss-selling and another £5 billion may well be heading in the direction of the DOJ.  Perhaps there is some light at the end of the tunnel with the possibility of RBS (71% owned by taxpayer) returning to private ownership in a couple of years.  The fact that the Williams & Glyn branches will not have to be sold will help contribute to the recovery process in SME lending. A profit of £600 million may be posted on Friday against a £2 billion loss last year. The Bank of England has served 5 weeks’ notice to provide information on how each bank is monitoring its lending, particularly those with doubtful credit ratings.  Consumer lending is getting out of control as it increases by about 10% per annum. HSBC is the first major company to set the earning ball rolling on Monday.  There may be a £2 billion share buy-back.  Mark Tucker of AIA will replace Douglas Flint on 1st October.

 

UK companies posting numbers this week – Monday – HSBC, Fidessa, Keller Group, Senior, Tuesday – Centrica, Taylor Wimpey, SDL, Man Group, Rolls Royce, Greggs, Direct Line, Meggitt, BP, Greggs, Genel, NWF Group, Filtronic, International Game Technology, Wednesday – Rio Tinto, Dignity, Travis Perkins, Aggreko, BAE Systems, Johnston Press, RSA Group, William Hill, StatPro, Standard Chartered Bank, Thursday – Cobham, Mondi, Serco, Shire, Inmarsat, eSure, LSE, Spirent, Portmeirion, Friday – RPS Group, Pearson, Aon, Royal Bank of Scotland, Merlin Entertainment, Millennium Copthorne,

 

 US companies posting results this week – Monday – Loew’s, Tuesday – Xerox, Pitney-Bowes, Sprint, Pfizer – Wednesday – Groupon, Time Warner, Metlife, Tesla, Zynga, Thursday – Aetna, Allergan, Yum Brands!, Kraft Heinz, Viacom, Friday – Revlon, Calgon Carbon

 

Economic Data – Monday – UK Mortgage approvals, Tuesday – Tuesday, UK PMI Manufacturing, Wednesday – UK PMI Construction, Wednesday – UK PMI Services, MPC Meeting, Friday – US Non-farm Payrolls & 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​

TODAY’S FAYRE

TODAY’S FAYRE – Friday, 28th July 2017

 

 

“He was a mighty hunter in his youth

At Polmear all day on the mound, on the pounce

For anything moving, rabbit or bird or mouse-

My cat and I grow old together.

 

After a day’s hunting he’d come into the house

Delicate ears all stuck with fleas.

At Trenarren I’ve heard him sigh with pleasure

After a summer’s day in the long-grown leas-

My cat and I grow old together.

 

When I was a boy I wandered the roads

Up to the downs by gaunt Carn Grey,

Wrapt in a dream at end of day,

All around me the moor, below me the bay-

My cat and I grow old together.

 

Now we are too often apart, yet

Turning out of Central Park into the Plaza,

Or walking Lake Michigan Avenue against the lake-wind,

I see a little white shade in the shrubbery

Of far-off Trenarren, never far from my mind-

My cat and I grow old together.

 

When I come home from too much travelling

Cautiously he comes out of his lair to my call;

Receives me at first with a shy reproach

At long absence to him incomprehensible-

My cat and I grow old together.

 

No more frisking as of old

Or chasing his shadow over the lawn,

But a dignified old person, tickling

His nose against twig or flower in the border

Careful of his licked and polished appearance,

Ears like shell-whorls pink and transparent,

White plume waving proudly over the paths

Against a background of sea and blue hydrangeas-

My cat and I grow old together.”

 

 

AL Rouse – historian & poet – 1903-1997

 

 

The film ‘Dunkirk’ was all that it was cracked up to be! – Exciting, nationalistic, terrifying, courageous and beautifully filmed. Everyone from the age of 8 to 80 should see it. The most effective and chilling attribute of the film was the lack of talking in the script.  The action did the talking. There were wonderful cameo parts from Kenneth Branagh, Mark Rylance, Tom Hardy, Cillian Murphy and of course the thousands of civilian small boats who bravely made the journey to and from Dunkirk to the English coast line, shipping back 300,000 troops, desperately needed to bolster the war effort.  Even Harry Styles proved that there was a bit of a Thespian in him. It was a riveting production with very clever life-like special effects, filmed as if they really did take place in the Channel.

 

The earnings season really is under a wet sail on both sides of the Pond. In the US 2nd quarter earnings are expected to increase 10.7% from Q2 2016. Excluding the energy sector, the earnings growth estimate declines to 8.0%. Of the 239 companies in the S&P 500 that have reported earnings to date for Q2 2017, 73.6% have reported earnings above analyst expectations, according to Reuters. This is above the long-term average of 64% and above the prior four quarter average of 71%. The fact that the FED attached a benign note to their decision to leave interest rates unchanged until such time as inflation gets hold of the bit (2% circa at present) and or wage inflation gathers some momentum, no doubt helped Wall Street keep its equilibrium. Market experts remain somewhat flummoxed and frustrated that President Trump has failed to get much of his stimulating policies for business through Congress.  So the generally positive quality of earnings has prevented any sort of meaningful correction to equity bourses that remain at record levels or flirting with them.

 

Following in the wake of Facebook’s decent numbers on Wednesday (shares +4.02%) with sales +45% and profits up 71% to $3.89 billion for the last quarter on the back of 2 billion subscribers and 1 billion What’s App users, inevitably Twitter’s efforts were all but pitiful by comparison yesterday.  Subscriber were constant at 328 million, though US subscribers fell from 70 million to 68 million.  Sadly advertising revenue was wholly inadequate. Twitter’s shares tumbled by 14% to $16.84, having been $24 last October.  Amazon’s results saw profits down 77% ($197 million from $857 million last year) due to massive expansion plans in UK, Germany (Fresh) and TV on demand Channels. Sales were up 25% to $38 billion. Amazon shares fell 3.22% yesterday.  Amazon’s founder Jeff Bezos (company formed in 1995), remains just behind Bill Gates in terms of wealth – $88 billion against $89 billion. 

Wednesday and Thursday produced a massive slew of earnings.  The pick were decent numbers from Diageo and Royal Dutch Shell.  Shell’s £47 billion acquisition of BG is starting to pay dividends after a quiet period in terms of Shell’s share performance in the last year.  The oil mogul is making a fair fist of selling $30 billion of assets that are not core to the business going forward. Shell’s dividend remains attractive (47 cents). The yield to date is close to 6%.Lloyds Banking Group posted an 8% increase in pre-tax profits with a 16.6% return on equity. Tier One Capital stands at a very solid 14%. PPI is still a problem with a further £1 billion provision being made (£18 billion in total). The dividend is 1p – up 18%. Lloyds Banking share price dipped 2.3% to 67.48p yesterday (breakeven was 73p). However the taxpayer is finally out of this investment.  Shares have been dribbled out in the last 18 months thanks to some deft handling by Morgan Stanley. £21.2 billion has been returned to the taxpayer – £894 million more than the original investment, including a £400 million dividend.

Astra Zeneca really hit the buffers with news that its lung cancer drug, Mystic failed to pass muster with the regulator. The shares fell by 15% (£10 billion in value) to 4325p (remember Pfizer offered 5500 a share!). It was thought that this alternative to chemotherapy could be worth billions going forward.   CEO Pascal Soirot offered some solace with a £6.5 billion research tie up with Merck. Cynics could be forgiven for their diseased-ridden minds working overtime for the persistent rumours that prevailed that Soirot was off to Israel’s Teva.  Soirot’s riposte was ‘I am not a quitter!’

 

Today Barclays posted a profit of £2.34 billion for the half year. Tier One Capital was 13.1%. A write-down of £1.21 billion was made – provision for sale of Africa. PPI further provision of £700 million was made.  Return on equity was 7.2%, though investment banking revenue fell by 20% (equities interest rate products in the main). CEO Jes Staley said that restructuring was over and that Barclays would be spearheading its European banking from Dublin, but London remained in pole position as Europe’s leading financial centre. He made no comment about the Qatar court case or his outstanding ‘whistle blowing’ issues with FCA. Barclays’ shares are up 43% on the year, though down 12% since February 2017. BT’s results were average. Revenue was up 1% at £5.8 billion with profits down 42% as expected at £418 million. We await management changes in Italy and news on broadband front – So important for the company’s image as broadband is 3rd world quality.

 

It has become clear that the Financial Conduct Authority, according to CEO Andrew Bailey intends to replace LIBOR in 2021. Regulators intends to move the banking sector to a more reliable marker. It was insanity that until just a short time ago that a trade association should be responsible for acting as a mediator for $350 trillion worth of loans in an array of currencies. No decision has yet been made as to how the cost of loans and money will be calculated.  There is talk of a combination of overnight interest rate swaps, introducing 3 and 6 month Treasury Bills and maintaining perhaps some role for LIBOR. 

 

 

UK companies posting numbers this week – Friday – Barclays, Rightmove, Essentra, BT Group, UBM, IAG, Lonmin

 

 

    US companies posting results this week – Friday – American Airlines, Goodyear, Chevron, Exxon Mobil

 

 

 

 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​

TODAY’S FAYRE – Tuesday, 25th July 2017

 

WHAT does it mean? Tired, angry, and ill at ease,

No man, woman, or child alive could please

Me now. And yet I almost dare to laugh

Because I sit and frame an epitaph-

‘Here lies all that no one loved of him

And that loved no one.’

Then in a trice that whim Has wearied.

But, though I am like a river

At fall of evening when it seems that never

Has the sun lighted it or warmed it, while

Cross breezes cut the surface to a file,

This heart, some fraction of me, happily

Floats through a window even now to a tree

Down in the misting, dim-lit, quiet vale;

Not like a pewit that returns to wail

For something it has lost, but like a dove

That slants unanswering to its home and love.

There I find my rest, and through the dusk air

Flies what yet lives in me. Beauty is there.”

 

Edward Thomas – poet – 1878-1917

 

People talk about country house opera with infectious enthusiasm and it is easy to understand why – Glyndebourne, Garsington, Grange Park Opera and the Grange Festival. In recent years I have really been enraptured by productions put on by West Green House. Marylyn Abbott owns West Green House, near Hartley Wintney and she bought the lease from the National Trust in 1993.

 

The house and the new opera house sit in the most stunning gardens imaginable, which are at their very best for the two weekends selected for these productions. Marylyn had previously developed her well-known Kennerton Green garden in Mittagong, NSW. This year Verdi’s ‘Un Ballo in Machera’ was the opera we chose to go and see. This was a brilliant production by any standards with outstanding contributions made by all the lead singers.

 

Just in passing it is so annoying when the media take comments or prognoses from august bodies such as the IMF as Gospel. Last night at 10.45pm ITV’S Tom Bradby, probably a passionate ‘remainer’, relished at the prospect of the IMF’S downgrade of UK growth. Of course the fact that the IMF is often behind the curve and whose track record is modest at best is rarely taken in to account!

 

The NASDAQ hit a fresh record ‘high’ yesterday, ahead of a week of technology earnings reports, while the S&P 500 and the Dow industrials edged lower, weighed down by losses in healthcare heavyweight Johnson & Johnson. It’s shares were down 1.5%.

Google parent Alphabet reported its results after the stock market closed. The tech giant took a major hit on profits due to a record £2.7 billion EU fine. Google’s shares slumped below the $1,000 mark in after-hours trading (-3%). Amazon and Facebook are set to report later this week.

However investors remained wary ahead to the Federal Reserve statement due on Wednesday for clues about the future path of interest rate hikes. In other earnings news, Halliburton shares fell 4.2% after the oilfield services provider warned about flattening growth in North American rig count. WebMD Health Corp jumped 19.6%. Private equity firm KKR & Co agreed to buy WebMD in a deal valued at about $2.8 billion, bringing a slew of popular online health information websites under one umbrella. US markets closed as follows with YTD gains – DOW: 21,513 -0.31% +8.858% S&P: 2,469 -0.11% +10.321% NASDAQ 5,941+0.34% +22.159%. As for Asia it was a question of treading water, awaiting Central bank input – Asian Markets & YTD – NIKKEI: 19,972 unch +4.489%, HANG SENG: 26,841 unch +21.986% CHINA: 3,735 -0.22% +12.768% ASX: 5,736 +0.85% +1.241%.

 

Yesterday the FTSE lost 75 points to 7377 – much of it down to a weak Dollar, a set of results below par from Reckitt Benckiser due to the recent ‘cyber’ attack costing £100 million and poor performances from the oil and airlines sectors. Ryanair, despite the obnoxious ebullience of Michael O’Leary, still castigated the UK’s decision to leave the EU, but in the same breath posts a 55% increase in profits, helped by a bumper Easter. Ryanair still has designs on buying Alitalia and served notice that BREXIT would lead to higher prices. This warning took shares lower by 2.5%. You have to admire Michael O’Leary’s Irish blarney, but listen Old Chap, you’ve done well out of Old Blighty! So in the same manner as you took all your horses away from Willie Mullins as you did not like the training fees going up 10% after a protracted period of no increase, the UK has the same right to leave the EU! I think Ryanair will still fly in to the UK – Brexit or no Brexit! You’ve too much to lose! So stop whining!

 

This morning PZ Cussons and Domino Pizzas both posted reasonable results. Virgin Money saw its shares fall by 8% in early skirmishes, despite a solid performance from the challenger bank in the first half of 2017. Virgin Money posted an underlying profit before tax rising to £128.6mln from £101.8mln the year before, BUT full-year net interest margin would be at the lower end of its guidance range – hence investors ran to the hills, requiring further clarification!

 

Kantar UK grocery data posted news that Aldi’s & Lidl’s market share rose to 12.1%; Tesco, Morrison, Sainsbury’s and ASDA’S fell with Waitrose’s unchanged. Michael Kors announced that it was paying £896 million for Jimmy Choo’s.

 

Alphabets results in isolation were good. A profit of $3.5 billion on increased revenue of $26 billion for the last quarter was blighted by an EU fine of $2.7 billion over crossing sales boundaries. Alphabet will almost certainly appeal but few think the search engine giant will win. We hear there are another 2 possible cases are waiting in the wind. Google encompasses 90% of the search capacity in Europe and the EU don’t like it. Me? I’m a free marketer and I like to think the market will charge what the traffic will bear. YouTube has been a huge contributor to Alphabet’s bottom line. It has 1.5 billion subscribers and 100 million people watch it every day. Advertising revenue has dropped on YouTube due to some undesirable content, but it remains a huge ‘Arfur Daley!’

 

UK companies posting numbers this week – Wednesday – 3i Group, ITV, GKN, Tullow, Hammerson,  Compass Group, Robert Walters, PayPoint, Unite Group, Glaxo SmithKline, Antofagasta, Marston’s, Brewin Dolphin, Paragon, Sage Group, Thursday – Royal Dutch Shell, BATS, Lloyds Banking Group,  Thos Cook, Smith & Nephew, Diageo, Sky, Mitchell & Butler, Tate & Lyle, Bodycote, Ladbroke Coral, CMC Markets, Jardine Lloyd Thompson, Vesuvius, Intu Properties, RELX, Weir Group, Just Eat, Inchcape, National Express, St James’s Place, Countrywide, Astra Zeneca Friday – Barclays, Rightmove,  Essentra, BT Group, UBM, IAG, Lonmin

 

US companies posting results this week – Tuesday – Caterpillar, 3Ms, Pulte, Biogen, JetBlue, General Motors, Dolby Systems, AT&T, Texas Instruments, Amgen, Wednesday – BGC Partners, Northrop Grumman, Boeing, PayPal, Facebook, Whole Foods, Whirlpool, Xilinx, Thursday – Raytheon, Conoco-Phillips, NGM Resorts, Valero Energy, Bristol Myers Squibb, Dupont, KKR, Twitter, Procter & Gamble, BJ Restaurants, Intel, Starbucks, Mattel, Friday – American Airlines, Goodyear, Chevron, Exxon Mobil

 

Economic data posted this week – Tuesday – US Consumer Confidence, Wednesday – Nationwide House price Index, UK GDP Preliminary, FOMC Statement, US New Home Sales, Thursday – US durable Goods, UD Initial Jobless Claims, US GDP preliminary, 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 ​

MARKET UPDATE

It is 3.24pm. To use the vernacular, the markets have had a bit of a dump. The weak Dollar/Strong Sterling plus the added irritation of a slightly downbeat growth adjustment from the IMF have put the FTSE 100 slightly to the sword – down 89 points at 7365 – the day’s low. Dollar related earning stocks have taken a bit of a larruping – the likes of BATS. IMPS, Diageo, Unilever, Sky, Reckitt Benckiser are all down circa 1.5%.  Oils have been on the back foot – BP -1.5% and RD Shell -1%.  Miners have been mixed – Glencore OK, but BHP Billiton -1%. Drugs are down by an average of 1.25%. Banks are a little easier but nothing too serious.

Of those companies that have reported today – Ryanair -2.3% (easyJet as a comparison 3.2% lighter, Imagination up 6.1%, Cranswick up 2.4%%, Tungsten -6.2%, Eland oil up 1.8%. The Street of Dreams is currently down 60 points.

TODAY’S FAYRE

TODAY’S FAYRE – Monday, 24th July 2017

 

“Three lovely notes he whistled, too soft to be heard

If others sang; but others never sang

In the great beech-wood all that May and June.

No one saw him: I alone could hear him

Though many listened. Was it but four years

Ago? or five? He never came again.

 

Oftenest when I heard him I was alone,

Nor could I ever make another hear.

La-la-la! he called, seeming far-off—

As if a cock crowed past the edge of the world,

As if the bird or I were in a dream.

Yet that he travelled through the trees and sometimes

Neared me, was plain, though somehow distant still

He sounded. All the proof is—I told men

What I had heard.

 

I never knew a voice,

Man, beast, or bird, better than this. I told

The naturalists; but neither had they heard

Anything like the notes that did so haunt me,

I had them clear by heart and have them still.

Four years, or five, have made no difference. Then

As now that La-la-la! was bodiless sweet:

Sad more than joyful it was, if I must say

That it was one or other, but if sad

‘Twas sad only with joy too, too far off

For me to taste it. But I cannot tell

If truly never anything but fair

The days were when he sang, as now they seem.

This surely I know, that I who listened then,

Happy sometimes, sometimes suffering

A heavy body and a heavy heart,

Now straightway, if I think of it, become

Light as that bird wandering beyond my shore.”

 

Edward Thomas – poet – 1878-1917

 

I watched the final round of the Open Golf at Royal Birkdale yesterday! What a championship and what a Houdini act by Jordan Spieth – a worthy winner by three shots from Matt Kucher. However I had to laugh at the fact that the majority of the players sported designer stubble, 7 o’clock shadow or beards. I’ve always had huge respect for Warren Buffett’s investment perception. He must have been very happy that Gillette, in whom he had a sizeable investment, was sold to Procter & Gamble in 2005 for $57 billion. After all know one shaves these days apart from very few of us!

 

To find that the District Line was closed after the weekend’s reconstruction work on the line did not best please me at 5.45am this morning. It strikes me that since Mayor Khan assumed his duties London, as a City, has gone backwards. Fewer houses have been built since the previous year. The capital is like a builder’s yard in terms of the roads. Cyclists now get greater preferential treatment than cars, buses and taxis, making life for the business community irksome in the extreme. The Mayor just spends his time whinging about BREXIT, rather than being pro-active about making our capital fit for purpose to encourage business to come to London.

 

All Mayor Khan seems to do is to get in on every photo opportunity available, whilst involving himself in political rows that don’t concern him, like ‘slagging off’ and being discourteous to President Trump, when it is none of his business. He’s neither the Government nor the monarchy. I am amazed that he cannot see that dealing effectively with London’s housing and transport is massive job of gargantuan proportions. Get on with it, man!

 

Just a word about Chris Froome, who won his third ‘Tour de France’; there has been scant coverage over his not inconsiderable achievement. I suppose cycling is a ‘tainted sport.’ However there is no evidence that Chris has behaved in any way but in an exemplary manner and therefore he should be accorded respect. Amazing that last year Froome never got even close to making the podium in BBC’S SPOTY!

 

 

As Anthony Scaramucci starts to weave his own personalised web of White House news flow, as the newly appointed press officer, coupled with President Trump’s comments that he has the right to pardon anyone he cares to, the Dollar sank to a 2-year low. The Greenback’s decline was also aided and abetted by Trump stating unequivocally in a moment of deep frustration that his administration would just watch Obamacare fail. Consequently Asia did not enjoy a particularly fruitful session. As we headed towards the close, Asian markets stood as follows coupled with YTD performances – NIKKEI 19,985 -0.57% +4.458% HANG SENG 26,846 +0.53% +21.993% CHINA 3,743 +0.39% +13.057% ASX 5,681 -0.71% +0.349%.

 

 

Here in Old Blighty the IMF was quick out of the blocks in suggesting UK and US economic growth for 2017 is being downgraded by the IMF from 2% to 1.7% in terms of the UK. The UK enjoyed “weaker than expected activity” in the first three months of the year – in contrast to its EU neighbours in France, Spain, Germany and Italy, who all had their growth forecasts revised up. China and Japan also show positive figures. These UK figures are often misleading in isolation. It is as well as to remember that for some years Germany, France and particularly Spain were recovering from growth significantly lower than ours. So ‘nil desperandum’, despite EY thinking there is a chance that UK will dip back temporarily in to recession, I am not that downbeat. The immediate problem the UK has is inflation close to 3% with wage inflation lagging at circa 2%. This needs to be addressed. The US has a similar problem.

 

We have all watched the way US banks have put on significant value since the US Presidential election with the likes of Goldman and JP Morgan rallying by between 27% and 32%. Hence I suppose we cannot be surprised that the likes of Lloyd Blankfein and Jamie Dimon likely to change the shape of their respective backs, humping largesse all the way to their respective safes. Their share holdings are worth about $150 million each. The FT tells us that Europe’s CEO earn about half what US bank chiefs do. It is hardly surprising, when the likes of Deutsche Bank have surrendered 28% in value in the last year.  It is interesting to note that in the UK seven out of 10 people believe that banks have not learned the lessons on the 2008/9 financial crisis.

 

This week is a huge earnings week. So the jury is out. However the FTSE 100 is currently down 49 points at 7403, with banks, mining and oil stocks easier thanks in some degree to an easier Dollar. Reckitt posted adequate numbers, but the shares have travelled and arrived – down 1.67%. Ryanair, despite all Michael O’Leary’s moaning & groaning about BREXIT saw profits up 55% thanks in some way to a great Easter holiday – shares are down 3.5%. Again they have had a great run in the past year and perhaps there is a need for a rest.  

 

 

UK companies posting numbers this week – Tuesday – PZ Cussons, Domino Pizzas, Games Workshop, Virgin Money, Provident Financial, Informa, Rathbone, Wednesday – 3i Group, ITV, GKN, Tullow, Hammerson,  Compass Group, Robert Walters, PayPoint, Unite Group, Glaxo SmithKline, Antofagasta, Marston’s, Brewin Dolphin, Paragon, Sage Group, Thursday – Royal Dutch Shell, BATS, Lloyds Banking Group,  Thos Cook, Smith & Nephew, Diageo, Sky, Mitchell & Butler, Tate & Lyle, Bodycote, Ladbroke Coral, CMC Markets, Jardine Lloyd Thompson, Vesuvius, Intu Properties, RELX, Weir Group, Just Eat, Inchcape, National Express, St James’s Place, Countrywide, Astra Zeneca Friday – Barclays, Rightmove,  Essentra, BT Group, UBM, IAG, Lonmin

 

 

US companies posting results this week – Monday – Halliburton, Alphabet, Anadarko, Tuesday – Caterpillar, 3Ms, Pulte, Biogen, JetBlue, General Motors, Dolby Systems, AT&T, Texas Instruments, Amgen, Wednesday – BGC Partners, Northrop Grumman, Boeing, PayPal, Facebook, Whole Foods, Whirlpool, Xilinx, Thursday – Raytheon, Conoco-Phillips, NGM Resorts, Valero Energy, Bristol Myers Squibb, Dupont, KKR, Twitter, Procter & Gamble, BJ Restaurants, Intel, Starbucks, Mattel, Friday – American Airlines, Goodyear, Chevron, Exxon Mobil

 

 

Economic data posted this week – Monday – US existing Home Sales, Tuesday – US Consumer Confidence, Wednesday – Nationwide House price Index, UK GDP Preliminary, FOMC Statement, US New Home Sales, Thursday – US durable Goods, UD Initial Jobless Claims, US GDP preliminary, 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 ​

TODAY’S FAYRE

TODAY’S FAYRE – Sunday, 23rd July 2017

 

“Dawn an unsympathetic yellow.
Cra-aack!  – dry and light.
The house was really struck.
Crack!  A tinny sound, like a dropped tumbler.
Tobias jumped in the window, got in bed–
silent, his eyes bleached white, his fur on end.
Personal and spiteful as a neighbor’s child,
thunder began to bang and bump the roof.
One pink flash;
then hail, the biggest size of artificial pearls.
Dead-white, wax-white, cold–
diplomats’ wives’ favors
from an old moon party–
they lay in melting windrows
on the red ground until well after sunrise.
We got up to find the wiring fused,
no lights, a smell of saltpetre,
and the telephone dead.

The cat stayed in the warm sheets.
The Lent trees had shed all their petals:
wet, stuck, purple, among the dead-eye pearls.”

 

Elizabeth Bishop – poet – 1911-1979

 

The Donmar’s production of ‘The Committee’ received mixed reviews. It was a quasi-musical-play based on The House of Commons Public Affairs Committee’s hearing on the collapse of ‘The Kid’s Company’ run by Camilla Batmanyhelijh and chaired by BBC’S Alan Yentob. Bernard Jenkin MP chaired the committee with Cheryl Gilliam MP, Paul Flynn MP, David Jones MP assisting with the inquiry.

 

The performances were excellent particularly Alex Hanson as Bernard Jenkin, whom I know, was disarmingly authentic and Omar Ebrahim who portrayed Alan Yentob, who fitted snugly in to the role! It was have made a fantastic straight play. Unfortunately the music attempted to ruin it. I am pleased to say it failed dismally. The production was great entertainment. 

 

We took in a screening of part one of the National Theatre’s production of ‘Angels in America’ – 3 hours 30 minutes in duration.  You needed to ‘get four miles in a bog’ to see it through – very inadvisable to be consuming ANY alcoholic beverage before or during this marathon production. The performances in this play about homosexuality, AIDS and facing death in New York during the Reagan Presidency in the 80s, were off the scale.  Andrew Garfield, fresh from ‘Hacksaw Ridge’, Denise Gough, Russell Tovey, Nathan Lane and James McArdle were sensational.  I only had one problem with this production, I did not have a clue what they were on about. Intellectually it was a stratosphere above my head!  We are seeing part two next week – 4 hours!  Wish me well!

 

Having read Evening Standard’s Joe Murphy’s consistently down beat state of London’s economy in Friday’s edition, with apparently droves of people, if fact thousands as I understand it, leaving to UK to go back to the land of milk and honey, which goes under the pseudonym of the EU, I just wanted to reassure others that London is absolutely HEAVING with every bar and restaurant bursting at the seams.  I was in the West End on both Thursday and Friday night and it was virtually impossible to move, with the atmospheric revelry all but toxic!  It is a pity that the Government and the arrogant Barnier could not see the urgency required to sort out the domicile rules as well as those who ran for cover, could not have had a bit more patience.  We are not cooked yet in London, not by a long chalk! For those interested in financial, though anal and anorak data, let me tell you where Frankfurt and Paris are rated as global financial centres, according to the GFCI rankings! – 23rd and 29th respectively! London is, of course, NUMERO UNO! And by the way Robert Walters City Job Index finds Square Mile jobs rose 17% in June compared to same month 2016. Some of us could be forgiven for thinking that the REMAIN press just publish what they want us to hear rather than what is being said in places.

 

Last week was challenging for markets from many aspects, particularly from the world of politics.  As PM May heads for the mountains and hopefully three weeks respite from the worst two months of her political life, where everything that could go wrong, in the wake of a horrific General Election campaign, did. She may be safe for the time being but Labour & the Lib-Dems, fired up by their new 74 year old leader Sir Vince Cable, will give the Government a very hard time over BREXIT legislation.  Donald Trump reeled from one domestic crisis to another as he removed Sean Spicer as head of Communications and replaced him with Anthony Scaramucci.  Whatever the Trump administration threw at equity markets, they managed to shrug them off, apart from Europe.  The guidance proffered by the ECB’S Mario Draghi on interest rates was taken with a pinch of salt. Market just did not believe that there would be no tapering of QE or some kind of interest rate hike down the line.  This resulted in the Euro hitting its highest level against the Greenback for two years. There appeared to have been no influence brought to bear by the ECB in terms of supporting the Euro.

 

Not surprisingly European bourses sold off towards the end of last week against this currency background and interest rate conundrum. By the end of the week the S&P 500 had gained 0.47%, but was off its best levels with energy and oil sectors suffering from the 2% drop in oil prices. The FTSE 100 gained 1%. Much of it down to M&A activity and gossip plus some better than expected quarterly earnings. Gold was $8 to the good touching $1253 an ounce briefly.

 

In terms of the DAX and CAC it should not be forgotten that these two indices as well as others in Europe attracted a huge amount of cash based on easy monetary policy; so it is not unreasonable that profits should be taken, when there is a lack of clarity. That is what happened as European bourses surrendered an average of 1.84% last week. The earnings season in the US is on the whole going well, though eBay -3% and GE after a disappointing effort on Friday down 2.9% took the gilt off the gingerbread.   There were a fair few interesting stories from last week’s escapades. Sports Direct’s Mike Ashley surprised investors with his outlook and plans despite a 57% cut in profits.  The shares rallied by about 16% on the week. Unilever posted great numbers – amazing what can be done when a company like Kraft Heinz threatens to take you over, supplemented by pressure from active shareholders like Elliott Advisors – shares are up 30% in the past 4 months. EasyJet did increase their passenger take by 10%, but now have to look for a new chief executive now that Dame Carolyn McCall is to head up ITV.

 

This week is all about earnings, which will capture most investors’ and analysts’ imagination on both sides of the pond – The list is endless of companies posting results as can be seen below. Bakkavor, a supplier to M&S and Tesco may seek a floatation valuing the company at £1 billion.  A Beijing backed fund may look to buy Imagination Group, having been scurrilously treated by Apple. ASDA, after many troubles in recent years is ruminating over the possibility of buying B&M, the fast growing discount retailer run by the Arora bothers and chaired by Sir Terry Leahy.

 

UK companies posting numbers this week – Monday – Reckitt Benckiser, Tungsten Corporation, Cranswick, Tuesday – PZ Cussons, Domino Pizzas, Games Workshop, Virgin Money, Provident Financial, Informa, Rathbone, Wednesday – 3i Group, ITV, GKN, Tullow, Hammerson,  Compass Group, Robert Walters, PayPoint, Unite Group, Glaxo SmithKline, Antofagasta, Marston’s, Brewin Dolphin, Paragon, Sage Group, Thursday – Royal Dutch Shell, BATS, Lloyds Banking Group,  Thos Cook, Smith & Nephew, Diageo, Sky, Mitchell & Butler, Tate & Lyle, Bodycote, Ladbroke Coral, CMC Markets, Jardine Lloyd Thompson, Vesuvius, Intu Properties, RELX, Weir Group, Just Eat, Inchcape, National Express, St James’s Place, Countrywide, Astra Zeneca Friday – Barclays, Rightmove,  Essentra, BT Group, UBM, IAG, Lonmin

 

 

    US companies posting results this week – Monday – Halliburton, Alphabet, Anadarko, Tuesday – Caterpillar, 3Ms, Pulte, Biogen, JetBlue, General Motors, Dolby Systems, AT&T, Texas Instruments, Amgen, Wednesday – BGC Partners, Northrop Grumman, Boeing, PayPal, Facebook, Whole Foods, Whirlpool, Xilinx, Thursday – Raytheon, Conoco-Phillips, NGM Resorts, Valero Energy, Bristol Myers Squibb, Dupont, KKR, Twitter, Procter & Gamble, BJ Restaurants, Intel, Starbucks, Mattel, Friday – American Airlines, Goodyear, Chevron, Exxon Mobil

 

 

Economic data posted this week – Monday – US existing Home Sales, Tuesday – US Consumer Confidence, Wednesday – Nationwide House price Index, UK GDP Preliminary, FOMC Statement, US New Home Sales, Thursday – US durable Goods, UD Initial Jobless Claims, US GDP preliminary, 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​

MARKET UPDATE

Well here we are – Thursday afternoon at 3.00pm with the FTSE 100 just short of the day’s high – up 55 points at 7485. London’s session followed in the wake of a positive session in Asia, with the BOJ doing little to destroy new found confidence, thanks to inflation being left in the in-tray in Japan until 2019 by Governor Kuroda-san. New York had previously enjoyed an upbeat session with the S&P 500 and the NASDAQ breaking new ground with fresh records. This is an amazing state of affairs as I keep tripping over people that feel equities are not only over-priced but also that financial Armageddon is just around the corner. I can cope with the former comment, but a financial meltdown may take a bit longer, though I am very wound up by the Chinese banking system, which appears to be hopelessly over-lent against a massive amount property, much of which is not habited.

 

Yes I accept that there are no alternative asset classes that are attractive and one must be bemused by the fact that Trump has delivered ‘diddly-squit’ in terms of a cut in regulation, healthcare or infrastructure spending. The DOW is down just 8 points as I speak.

 

Of those companies that reported today, Sports Direct grabbed the yellow jersey. Despite the profits for the last trading period falling 57%, there was sufficient encouragement in the figures for the future for the shares to rise like the proverbial grilse – up 16% at one time but settling recently +11%. Moneysupermarket also had a roller coaster ride, initially losing 13%, but I as scribe it is only down 3.5%. easyJet’s Dame Carolyn McCall posted her penultimate set of numbers, which analyst found holes in – down 6%. Unilever pleased its acolytes and the shares were 1.2% to the good. It’s amazing what can be done when shareholders stop being passive and insist on shareholder value.

 

Howden Joinery was up 1.9%, with the AA unchanged and SSE up just a smidgen b7y 0.25%. Premier Foods were 3% to the good and Ashtead were up 3%. Draghi tried to upset the applecart with unintelligible gobbledygook. It looked as if he might attempt to upset the applecart, but he consummately failed.  

TODAY’S FAYRE,- The Palace of Westminster , Retirement (whatever that means) & markets

TODAY’S FAYRE – Thursday, 20th July 2017

“Come, dear children, let us away;

Down and away below!

Now my brothers call from the bay,

Now the great winds shoreward blow,

Now the salt tides seaward flow;

Now the wild white horses play,

Champ and chafe and toss in the spray.

Children dear, let us away!

This way, this way!

 

Call her once before you go—

Call once yet!

In a voice that she will know:

“Margaret! Margaret!”

Children’s voices should be dear

(Call once more) to a mother’s ear;

 

Children’s voices, wild with pain—

Surely she will come again!

Call her once and come away;

This way, this way!

“Mother dear, we cannot stay!

The wild white horses foam and fret.”

Margaret! Margaret!

 

Come, dear children, come away down;

Call no more!

One last look at the white-wall’d town

And the little grey church on the windy shore,

Then come down!

She will not come though you call all day;

Come away, come away!”

 

Matthew Arnold – poet & author – 1822-1888

 

I had the most pleasurable of days yesterday, as the guest of Baroness Jenkin and also courtesy of my good friend James Max, with a guided tour of the Palace of Westminster including lunch in the House of Lords dining room, probably the most exclusive club in the country – What an exquisite emporium of history over the centuries! It was such a huge privilege; one that I shall treasure for a very long time. However the Palace is in a dilapidated state and in urgent need of reconstruction. Some of the facilities are anachronistically feudal. I understand that the renovation could cost £6 billion. Such is the decayed state of the whole building, I can believe it. This is money the country probably cannot afford. Perhaps, as my colleague Simon French has suggested, Parliament could be moved to Birmingham, if there is a purpose built building to house a thousand people. Maybe that would cost a great deal less than £6 billion and the Houses of Parliament could be renovated slowly as a museum for the great histories of this great democratic nation.

 

Many people muttering under their breath at the ignominy of having the retirement threshold raised to 68 by 2037-39 to qualify for OAP, need to wake up and smell the coffee. As we live to be older and whilst interest rates remain benign, there will be no money available. I genuinely believe that. I hope to be proved wrong. In the event of me being too pessimistic, I believe blue collar workers should have special dispensation, as physical work can takes its toll. They should be allowed to enjoy the twilight of their lives at 65.

 

Even though the Greenback remained weak, the Street of Dreams reached new records, with the S&P and the NASDAQ to the fore – DOW: 21,574 -0.25% +9.169% S&P: 2,460 +0.06% +9.906% NASDAQ: 5,880 +0.69% +20.90%. Yesterday’s earnings were better than expected, even though IBM was marginally disappointing – down 4.2% as were results from CSX – down 5.1%. The S&P 500 tech sector, which has been the best performing sector this year, broke its previous record closing high that it had held since March 2000. Vertex jumped as much as 26.4% to an all-time high of $167, a day after it reported positive results for its cystic fibrosis treatment. The stock ended up 20.8% at $159.69. Morgan Stanley added 3.3% after reporting better-than-expected numbers, with bond trading revenue declining only 4%. From the tech sector the usual suspects – Facebook, Amazon, Alphabet and Microsoft all enjoyed a bit of a run on the rails.

 

Simon French, Panmure’s chief economist made the following insightful observations on the Japanese economy post the BOJ meeting today. With Japan maintaining its 2.7% unemployment rate, -0.1% bank rate, QE on-going at Y80tn a year, it generates an inflation rate of just 0.4% YoY. Governor Kuroda has just revealed the BoJ thinks Japan’s inflation will now not hit 2% until FY2019, despite them injecting monetary heroin into every part of the economy. For example the BoJ now owns 45% of all JGBs and 71% of all Japanese equity ETFs. Easily dismissed as “well that is just Japan” the low inflation now being seen in the US, Eurozone is something that will worry the Fed/ ECB as in academic circles the Japan 90s case study is the precedent that no central banker wants to replicate.  Asian Markets headed towards the close in quite a buoyant mood as follows – NIKKEI: 20,020 +0.11% +4.657% HANG SENG: 26,646 +0.47% +21.165% CHINA: 3,699 +0.88% +11.793% ASX: 5,738 +0.91%, +1.257%.

 

Yesterday the FTSE 100 gained 40 odd points to 7431 with house builders leading the charge, aided and abetted by the Reckitt/McCormick deal. This morning the moderately upbeat mood filtered in to this morning’s opening salvos– up 35 points at 7466 at 10.00am. Though Moneysupermarket did not pass muster – down 13%, there were solid or encouraging numbers out there. Unilever saw sales up 3% and turnover by 5.5% in the last quarter, with net profits up 22%. It’s amazing how shareholder objection on failing to deliver adequate shareholder value can truly have the desired effect – shares up 0.8%. easyJet’s efforts were solid with passenger numbers increasing by 10.8% to 24 million with profits guidance for the year posted at between £380-£420 million. Now finally for Sports Direct’s Mike Ashley’s 10th anniversary since this high street cheap and cheerful outfitter came to the market with its shares priced at 330p. These shares hit 836p in 2014. Since then the company has been dogged by bad corporate governance, employment issues at its warehouse culminating with a court case of whether Mr Ashley promised Jeff Blue of Merrill a bonus of £14 million if SD’S share price reached a certain level. Anyway today’s profits for the last trading period fell by 57.8% to £113 million thanks mainly to currency vagaries. However Mike Ashley was quick to dismiss this number as a blip and was quick to point out that the company had paid £1.8 billion in tax as well as distributing £320 million of bonuses to 4,800 staff in the last decade.

 

UK Retail Sales were posted at 9.30am today. Simon French said – “These numbers were reasonable UK retail sales print. In the 3 months to June 2017, the quantity bought (volume) in the retail industry is estimated to have increased by 1.5%. The growth for Quarter 2 (Apr to June) 2017, follows a decline of 1.4% in Quarter 1 (Jan Mar) 2017. June itself was a 0.6% MoM increase – with online sales (16.2% of all sales hitting a new all-time record and up 15.9% YoY). We are not boom times as it was for retailers in 2016 but the wallets have not been slammed shut consistent with decent credit availability and a strong labour market.

 

UK companies posting numbers this week – Thursday – Sports Direct, Moneysupermarket, Unilever, Howden Joinery, Premier Foods, Anglo-American, SSE, EasyJet, Friday – Acacia Mining, Euromoney, Close Brothers, Vodafone.

 

US companies posting results this week – Thursday – Omnicom, Bank of New York Mellon, Travelers, Abbott Labs, Microsoft, eBay, Snap-on Inc, Philip Morris

 

Economic data posted this week – Thursday – CBI Industrial Order Expectations, US Initial Jobless Claims, Friday – UK PSBR, US PMI Manufacturing

 

 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 ​

TODAY’S FAYRE

TODAY’S FAYRE – Wednesday, 19th July 2017

 

 

There is a Smile of Love

And there is a Smile of Deceit

And there is a Smile of Smiles

In which these two Smiles meet

 

And there is a Frown of Hate

And there is a Frown of disdain

And there is a Frown of Frowns

Which you strive to forget in vain

 

For it sticks in the Hearts deep Core

And it sticks in the deep Back bone

And no Smile that ever was smild

But only one Smile alone

 

That betwixt the Cradle & Grave

It only once Smild can be

But when it once is Smild

Theres an end to all Misery”

 

William Blake – poet & painter – 1757-1827

 

I am not a massive fan of musicals.  However I was generously entertained at the Theatre Royal Drury Lane to see the latest production of “42nd Street.” – AMAZING! What a vibrant, enthusiastic and wonderfully colourful production with tap dancing of the highest possible calibre by the whole cast with great individual performances put in by Sheena Easton, and Clare Halse! We loved every minute of the entire production.  Great songs revived such as “You’re getting to be a habit with me!”, “We’re in the money!”, “Lullaby of Broadway” and the “42nd Street” chorus itself! – A truly memorable evening!

 

The Street of Dreams has seen its investors surprisingly supportive of the long-term cause as all indices have either achieved record levels or consistently flirt with them. There has been little of no volatility, which is surprising as President Trump has pushed through next to nothing in terms of legislation – healthcare infrastructure spending or tax cuts! The lack of volatility was clear for all to see with the bank results posted on Friday and yesterday. JP Morgan and Citibank reflected this trend last week and Goldman Sachs’s numbers were even more explicit in terms of a dramatic downturn in trading income. Fixed income plunged 40%, investment banking 3% and general trading by 17% ($3.05 billion). Total revenue was down 1% at &.89 billion. Profits of $1.73 billion beat expectations.  Shares fell by 2.6% but since the Presidential Election Goldman’s share price has rallied by 26%. Bank of America and Johnson & Johnson pleased their acolytes but it was technology that proved to be the largest percentage gainer among the 11 S&P 500 sectors. Healthcare ended up less than 0.1%.
The NASDAQ was largely boosted by Netflix (NFLX.O). The movie streaming company added 13.5% a day after it crushed Wall Street forecasts by reporting 5.2 million new streaming customers in the second quarter. The DOW was down slightly on the session, with the S&P 500 all but flat with the NASDAQ up 0.47%. Despite a strong Yen Asian markets were in positive territory. Towards the close markets were looking to close as follows plus YTD achievements
– NIKKEI: 20,020 +0.11% +4.657% HANG SENG: 26,646 +0.47% +21.16% CHINA: 3,699 +0.88% +11.793% ASX: 5,738 +0.91% +1.257%.

 

UK companies posting numbers this week – Wednesday – Drax,  Wizz Air, RPC Group, Evraz, TalkTalk, Severn Trent, Thursday – Sports Direct, Moneysupermarket, Unilever, Howden Joinery, Premier Foods, Anglo-American, SSE, EasyJet, Friday – Acacia Mining, Euromoney, Close Brothers, Vodafone.

 

    US companies posting results this week – Wednesday – Northern Trust, Alcoa, American Express, Thursday – Omnicom, Bank of New York Mellon, Travelers, Abbott Labs, Microsoft, eBay, Snap-on Inc, Philip Morris

 

Economic data posted this week – Thursday – CBI Industrial Order Expectations, US Initial Jobless Claims, Friday – UK PSBR, US PMI Manufacturing

 

 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​