TODAY’S FAYRE – Wednesday, 25th October 2017
“On Sunday afternoons
In winter, snow in the air
People sit thick as birds
In the station buffet bar.
They know one another.
Some exchange a few words
But mostly they sit and stare
At the urns and the rock buns.
Not many trains today,
Not many are waiting for trains
Or waiting for anything
Except the time to pass.
The fug is thick on the glass
Beyond which, through honks and puffing,
An express shrugs and strains
To sidings not far away.
Here no one is saying goodbye;
Tears, promises to write,
Journeys, are not for them.
Here, there are other things
To mull over, till the dark brings
It’s usual burdensome
Thoughts of a place for the night,
A bit of warm and dry.
On Sunday afternoons
The loudspeaker has little to say
Of wherever the few trains go.
Not many are travellers.
But few are as still as these
Who sit here in the snow,
Passing the time away
Till night begins.”
Anthony Thwaite – poet – 1930
Kristin Scott-Thomas, Timothy Spall, Cillian Murphy, Emily Mortimer and Patricia Clarkson all starred in Sally Potter’s recently released black comedy – “The Party” Mmmm… – well certainly interesting but there were some beautiful cameo parts portrayed particularly adroitly by Scott-Thomas and Spall. The humour was rather misplaced on me. In fact I found it to be rather sick humour, which did not really capture my imagination. However the fact that it was filmed in ‘black & white’ added to the macabre atmosphere. No accounting for taste these days and I suspect it will do very well.
Janet, celebrating her appointment as shadow health minister, invited her friends April, with her estranged German partner Gottfried, a life coach and professor Martha, with her partner, cook Jinny, and Janet’s colleague and subordinate Marianne, with her husband Tom, a casino banker. Before the party begins and even after the guests arrive, Janet’s husband Bill sits in his chair, listening to music, staring vacantly, and drinking wine. All invited guests come, with the exception of Marianne, who Tom says will arrive later. Tom is extremely nervous and immediately locks himself in the bathroom, where he sniffs some ‘white stuff’ examines a gun he has brought with him and encourages himself in the mirror. The plot unfolds! You won’t get close guessing what happens!
The BOE deputy governor for financial stability, Sir Jon Cunliffe has expressed confidence in the City of London’s standing as a financial hub post-Brexit. He does not see its success being replicated on the continent. He thinks that whilst some job moves may well take place, the capital’s financial centre crown was unlikely to be displaced. “It may be that some activities that are carried out in London have to move to the continent and maybe some activities carried out in London no longer become efficient, and rather than moving to the continent, they just go back to New York or somewhere else, or maybe they don’t happen at all.”
Lloyds Banking Group posted a trading update today. CEO Antonio Horta-Osorio, who has been in situ since March 2011 and apart from a couple of personal wobbles has done a great job in restoring some pride and respect in to the ‘Black Horse’, much of which disappeared when Lloyds bought HBOS in 2008 with indecent haste, which included its ‘Pandora’s box of ugly injudicious loans. The Government bailed the joint operation out for £20.3 billion and in fairness though the overall breakeven price for Lloyds was 73p, with various payments and dividends to UKFI, Lloyds is no longer obligated to the taxpayer, having dribbled out the final 15% stake in to the open market over a year with the final sale in May of this year, courtesy of the good offices of Morgan Stanley, who orchestrated much of the sale. In fact the government made a profit of £500 million from this regrettable transaction. Ironically when Horta-Osorio took over as CEO the share price was 67p where it is today, though it did get down to 40p in October 2012.
Lloyds posted a 38% increase for 9 months profits to £6.6 billion – profit after tax, up 50% at £3.1bn (£2.1bn for 9M 2016). 3rd quarter income was up 8%. A pre-tax profits for Q3 of £1.95 billion was posted, a rise of 141% from the same period last year. Tier One Capital was solid at 14.9%. There were no provisions for PPI and no outstanding conduct issues – thank goodness! – The bank having already paid out £18 billion for these misdemeanours. Now that the bank has a clean balance sheet with no major commitment to investment banking it is hard to see where it goes for gravy. It must muster all its strength in to mortgage lending (judicious), lending to SMES and fin-tech. However for shareholders little sign of jam. It may be unreasonable to expect too much from Lloyd’s share price until this court case brought by shareholders over the negligent manner it bought HBOS. The case is scheduled to last 14 weeks and could cost the bank £600 million. MBNA, the credit card operations, bought in December 2016 for £1.9 billion seems to have bedded down well, though yet to show outstanding results.
Yesterday the Dow added 168 points, or 0.72%, to end at 23,442, a record-high close. The S&P 500 gained four points, or 0.16%, to 2,569 and the Nasdaq Composite added 12 points, or 0.18%, to 6,598. 3M gained 5.9% and Caterpillar rose 5%, giving the Dow its biggest boost, after the companies reported quarterly results and gave upbeat outlooks. Decent efforts also came from General Motors +3%. McDonald’s was + 0.3% with competent numbers.
Stocks trimmed gains late in the day amid reports Stanford University economist John Taylor may have won in a show of hands by Senate Republicans when asked by President Donald Trump about their support of potential nominees for Federal Reserve chair. Many market participants think Taylor, one of several names circulating for the Fed nomination, would be more hawkish than current Fed Chair Janet Yellen and other potential nominees. Biogen (BIIB.O) slipped 3.9% after disappointing US sales of a potential blockbuster drug, Spinraza and Whirlpool tumbled 10.5% after the home appliances maker reported profit and sales below estimates and lowered full-year earnings guidance.
Yesterday the FTSE 100 finished near enough flat in a most uninteresting session with Whitbread down 5%. Though Whitbread’s Premier Inn performance was good Costa’s sales were down 9% – Plenty of competition in the high street. I think market makers were telling Alison Brittain the CEO that she may not have enough assortment of goods in her shopping basket. This morning Metro Bank disappointed, though superficially and historically, the numbers looked OK. Deposits from customers up £955m, 10% quarter-on-quarter to £10.8b ($14.4b), whilst the cost of deposits reduced from 53bp in Q2 2017 to 50bp in Q3 2017. Lending up £858m, 11% quarter-on-quarter to £8.6b ($11.5b) and a 1% increase in the loan to deposit ratio to 80%. Underlying profit before tax1 at £7.2m, a 77% increase from £4.0m in Q2 2017. Year to date underlying profit before tax1 is £13.2m versus £12.4m loss 2016. A record quarterly growth of 79,000 customer accounts to 1,124,000, up 33% year-on-year. GSK post numbers later this morning. At 9.30am UK GDP for the 3rd quarter is expected at +0.2% – 1.5% on an annualised basis. Industrial production and manufacturing only accounts for 15% of GDP – all eyes will be on the service sector.
Jayne-Anne Gadhia, chief executive of Virgin Money, has warned that sexism is deeply embedded in the financial services industry, citing several examples of discrimination she has encountered in her 25-year career and calling out investment banks for failing to back a government charter to promote gender diversity. Ms Gadhia, who led a government review of women in financial services, did not name the investment banks, but they are understood to be Goldman Sachs and JPMorgan Chase. Speaking to MPs on the Commons Treasury select committee yesterday, she also spoke of unsavoury behaviour at RBS, where she ran the mortgage business. Virgin Money is likely to be the first major financial operation with a female chairman and CEO, if Irene Dorner, ex HSBC is appointed chairman.
UK companies posting results this week –Wednesday – Metro Bank, Lloyds Banking Group, GSK, Antofagasta, Thursday – BT Group, Barclays Bank, Debenhams, National Express, Vitesse Media, Relx, Kaz, Friday – RBS, AON, IAG, Shire, Hastings
US companies posting interim results this week – Tuesday – Caterpillar, Lockheed Martin, United Technologies, 3Ms, Biogen, Pulte, General Motors, Corning, AT&T, Texas Instruments, Wednesday – Walgreen Boots Alliance, General Dynamics, Boeing, Coca-Cola, Visa, Northrop Grumman, Amgen, Xilinx, Thursday – Xerox, BGC Partners, Hershey, Bristol Myers Squibb, Valero Energy, Alphabet, Microsoft, Expedia, Mattel, Twitter, Friday – Colgate-Palmolive, Chevron, Exxon Mobil, Weyerhaeuser, Goodyear, Abbvie, Merck
Economic data posted this coming week – Wednesday – UK GDP forecasts, US New Home Sales, Thursday – Nationwide UK House Prices, US Initial Jobless Claims – Friday – Preliminary US GDP
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