Monthly Archives: January 2018



THE WEEK’S FAYRE– Sunday 28th January 2018


Clownlike, happiest on your hands,

Feet to the stars, and moon-skulled,

Gilled like a fish. A common-sense

Thumbs-down on the dodo’s mode.

Wrapped up in yourself like a spool,

Trawling your dark as owls do.

Mute as a turnip from the Fourth

Of July to All Fools’ Day,

O high-riser, my little loaf.


Vague as fog and looked for like mail.

Farther off than Australia.

Bent-backed Atlas, our traveled prawn.

Snug as a bud and at home

Like a sprat in a pickle jug.

A creel of eels, all ripples.

Jumpy as a Mexican bean.

Right, like a well-done sum.

A clean slate, with your own face on.”


Sylvia Plath – poet – 1932-1963


Last Monday morning at 11.00am at the Electric Cinema in Notting Hill Gate was a new experience for me. The only people allowed in to the cinema for showing of the much-heralded film ‘Post’ had to be the guest of a baby under one year old. This film is about the Washington Post’s obsessive endeavours to have the Pentagon Papers on the Vietnam War released to the public. The Post was hell-bent on exposing the White House for keeping the public in the dark on the futility of the Vietnam War.  A procession of Presidents from Eisenhower to Kennedy to Johnson and finally to Nixon had been guilty of this cover-up. The spell-binding episode certainly shifted American journalism’s relationship to Government power. Tom Hanks as the editor and Meryl Streep as the owner of the ‘Post’ gave their usual high-class polished performances in this dramatic story. This film was really a precursor to what happened when the Post’s two top investigative journalists, Bob Woodward and Carl Bernstein exposed the skulduggery of Richard Nixon’s administration in Watergate ‘cover-up’ in 1972.  I have to confess I was extremely grateful for the sub-titles to this film as the cacophony of screaming and crying made it impossible for the ‘yummy mummies’ and the grandparents to hear the dialogue!



Though President Trump would probably not be my number one choice to my dinner table on Saturday night – well maybe, out of novelty value, he might!  Nonetheless he certainly put his points of views across very succinctly in Davos and the delegates’ interest in him was all-consuming!  Just look at the crowds that queued to watch his entry and to hear his speech. ‘America will always be first but engaging with the rest of the free world.’ It went down better than most could ever have believed. PM May seems to be back in the President’s good books with encouraging noises being made about trade. However PM May was very low-key in Davos.  She is right to be so.  No point updating the world on BREXIT when there is nothing to say. Macron’s brilliant superficial Gallic charm was there for all to see as he weaved his spider’s web around many gullible international CEOS from around the world to set down their stalls in Paris at London’s cost. French labour laws are penal. Not everyone speaks French and speaking on London’s behalf 70 years of infrastructure is unlikely to be chucked out of the window, on a whim that Paris and Frankfurt might be fun places to work. Shifting thousands of jobs is expensive and the damage to a business by moving reluctant employees could be irrevocable.



Though Davos grabbed most of the major headlines last week there was still much to ponder, ruminate and react to from the world of business, economics and politics. Firstly the IMF couldn’t resist having its annual ‘pop’ against the UK downgrading its growth for 2018 to 1.5% from 1.6%, whilst at the same time raising most other countries, apart from South Africa, and the world’s GDP to nearly 4%.   Ever since the IMF bailed out the UK in 1975/6 for a record £3.9 billion, it has had a problem with the UK and its prognosis for its economy over 40 years has very often been wrong.  I think it will be this year as the annual rate looks nearer 1.8%, as posted on Thursday, which in fairness was at its lowest level since 2012. Unemployment in the UK also continued to fall by approximately 100k in the last quarter (rate 4.2%). However as Panmure Gordon’s Simon French points out “Private sector wages falling steadily for a decade – now £100/week below 2006 levels.” In regards to the UK’s PSBR, Mr French says “Even allowing for £1.2bn repayment from EU the December the numbers are encouraging – down to £2.6bn in December. Chimes with his view that the UK economy (ex-London-specific challenges) is doing rather well!”



Growth for the US came in at a disappointing level of 2.3%, somewhat below Trump’s vision of 3%, but the outlook is very positive.  The fall in the Dollar against the Euro (-16.5%) since August 2017 and 17% against the Pound since March 2017 may have helped US trade according to Treasury Secretary Steve Mnuchin.  Next week the FOMC meets.  No change is expected though two small increase are expected in 2018.  The month of January has been great news for US markets.  The DOW has rallied by 7.5% in the last month to a record level of 26616, the S&P by 6.8% to 2872 and the NASDAQ by 7.9% – much of the euphoria is due to the tax cuts!  Conversely the FTSE 100 only added 0.6% in the same period – its comparatively sluggish performance was down to the strength of Sterling. The US earnings season last week did well with Netflix acting as the standard bearer, but there were also good numbers from Johnson & Johnson, General Dynamics, Caterpillar, Raytheon, Intel and Honeywell amongst others. Trump’s tax cuts looks like good news for bank employees with the likes of Walt Disney also likely to spread its largesse around.


Here in Old Blighty the demise of Carillion took up so much air and press time.  However the news that Sky news could go as a result of the Government’s culture department dragging its feet over 21st Century’s bid for the remaining 61% of Sky, was sad.  I suspect that if Bob Eisner is successful with Disney’s bid for 21st Century, Sky could be superfluous to requirement. Tesco and Sainsbury could be laying off some staff in the months to come, as Lidl and Aldi dig in to their market share. Melrose’s hostile bid for GKN will come under closer Government scrutiny as it appears security issues may be of some concern. Having zapped ARM Holdings for £24 billion, Softbank now has its beady eyes taking on PayPal in its backyard.  It is likely to be funded from Sofbank’s $100 billion vision fund. This week is another hugely important earnings week in the US, with Facebook, Apple, Amazon and Microsoft to the fore. Results from Unilever, BT, Astra and Royal Dutch Shell will be significant.

 UK Companies posting results this week – Tuesday – CYBG, PZ Cussons, Domino Pizza, Filtronic, Wednesday – SSE Group, Dairy Crest, Britvic, Angle, Wizz Air, Thursday – Royal Dutch Shell, Unilever, RPC Group, 3is, Cranswick, Vodafone, Euromoney, Rank, AG Barr, Glencore, Friday – Astra Zeneca, BT, AON

US companies posting results this week – Monday – Rambus, Lockheed Martin, Tuesday – Aetna, Zimmer, HCA Healthcare, Pfizer, Harley-Davidson, Corning, AMD, Wednesday – DR Horton, Spire, Eli Lily, Boeing, Pitney Bowes, PayPal, eBay, Qualcomm, Facebook, Metlife, Mondolez, Microsoft, Thursday – MasterCard, Altria, Time Warner, Hershey, Conoco-Phillips, Amgen, Motorola Solutions, Apple, Alphabet, Amazon, Visa, Mattel, Friday – Ester Lauder, Exxon Mobil, Chevron, Johnson Outdoors


Economic data posted this week – Monday – US personal spending, Tuesday – UK Mortgage approvals and consumer Credit, US Consumer Confidence, Wednesday – FOMC Meeting, Gfk Consumer Confidence, US ADP index, Thursday – US Construction Spending, US & UK PMI Manufacturing, Friday – UK PMI Construction



TODAY’S FAYRE – Sunday, 21st January 2018



“Sunset and evening star,
And one clear call for me!
And may there be no moaning of the bar,
When I put out to sea,

But such a tide as moving seems asleep,
Too full for sound and foam,
When that which drew from out the boundless deep
Turns again home.

Twilight and evening bell,
And after that the dark!
And may there be no sadness of farewell,
When I embark;

For though from out our bourne of Time and Place
The flood may bear me far,
I hope to see my Pilot face to face
When I have crost the bar.” 

Alfred, Lord Tennyson – poet – 1809-1892




England seem to be a different side playing in the ODIs in Australia – no slumped shoulders; heads held high, batting with swagger and panache; bowling with venom and guile and fielding athletically.  We look a top side, though Australia tend to experiment and rarely peak until they are ready for a World Cup. Anyway here we are 2-0 up, with Hales, Roy, Root, Bairstow and Buttler putting bat to ball, looking a much more threatening than our opponents so far! The bowling attack looks very well balanced, which it never did in the Ashes series. The ODI is of course a different game altogether.  Nonetheless the performances have been altogether encouraging. Morgan, so far, has scored few runs, but is an inspiring skipper!  As I write the going looks tough for England at the SCG on a slow pitch against a better Australian attack – 150 for4!


We are just about through the first half of January, with the first quarter earnings season now under a wet sail. US has hit a brick wall in terms of a government shutdown and let’s hope the inconvenience is very temporary – an extraordinary event when the ruling party has a majority in Congress and the Senate! Despite this irritating setback the Street of Dreams defied all logic by closing close to all-time records – DOW +0.21%, S&P +0.44%, NASDAQ +0.55%. The quality of earnings has generally been up to snuff, though Goldman Sachs endorsed the poor trading earnings of the sector by seeing revenues from trading down by 30%. Otherwise bank earnings were good beating expectations and no doubt stimulated by the positive taxation factor. Apple announced that it will pay $38 billion in U.S. tax on its overseas cash, but will not reduce the $16 billion tax bill the company owes Ireland following a European Union ruling, the EU’s executive said on Thursday. The content from the FED’S Beige Book was benign and Industrial production was robust. China’s GDP was posted on Thursday. Its last quarter’s GDP slowed to 1.6%, YoY and YTD hold at 6.8% and 6.9% respectively; Retail Sales dropped to 9.4% YoY; Industrial Production ticked up to 6.2% YoY; FIA held at 7.2% YoY. This news had little impact on equities, which, near enough, kept their poise at the end of the week

There was a charm offensive with President Macron’s visit to the UK last week, but very few were buying his Napoleonic charisma. He did not visit Sandhurst and London because he likes us; he wanted money to pay for Calais and offered us a ridiculous sop of the loan of the Bayeux tapestry. However it was the message of an uncompromising BREXIT deal and particularly that affecting the City of London that hit the spot. We do not want to be in the single market or the customs union, nor do we eventually wish to adhere to the ECJ. That was what most people who voted for BREXIT wanted – to have the chains of bondage and inflexibility finally removed. I fear it may be time to stop playing charades if there is no deal in the offing. With Merkel still licking her electoral wounds, President Macron certainly sees himself in the ascendency. Maybe good sense will eventually prevail over these feisty negotiations, but I shall not be holding my breath.  Here in Old Blighty we had encouraging data on inflation down to 3% from 3.1%.  Expectations suggest 2.5% by August unless the Pound falls out of bed – hit $1.39 against the Greenback on Thursday.

Much of last week domestically was taken up with the catastrophic outcome of Carillion’s plight – liquidation; the loss of jobs, a loss of £1.5 billion (debt and pension black hole), the demise of many sub-contractors, totalling 30,000, which could see a number of small companies go to the wall; alleged disgraceful behaviour by management bordering on recklessness and unanswered questions as to the financial stability of Carillion by its auditors and the Government, which allowed this builder/outsourcer to tender for government work after a serious profits warning! Needless to say PFI contracts came under huge criticism and close scrutiny. Builders have warned the government that they will no longer accept fixed priced PFI contracts – a blow to the £600 billion infrastructure programme.  Also the financial vultures are hovering around the ruins, looking for cheap assets, which will almost certainly mean job losses. Canada’s Brookfield and the Dutch based engineer Endless have been mentioned in dispatches as possible predators.

UK retail sales in December fell by 1.5% compared with November, the biggest monthly fall July 2016 with consumers taking advantage of Black Friday offers and were up only 1.9% on the year. Carpetright and Bonmarche were the latest retailers to report a tough Christmas, following in the footsteps of Debenhams, Marks and Spencer, House of Fraser, and Mothercare. Retail was grateful for a strong Black Friday. Burberry also disappointed, though its Asian business stood up quite well. Shares eased by 4% after their trading update. AB Foods were very reliant on Primark, whose sales were up 7% over the holiday period. Whitbread also posted decent sales in the last quarter, which saw their shares up 4% on Thursday, despite Costa Coffee losing market share. DFS, Kingfisher and Dixons Carphone also shed value last week as the downbeat mood for retail prevailed. Sebastian James is leaving Dixons Carphone and is heading for Boots. Alex Baldock of Shop Direct replaces him.  EasyJet with a new CEO John Lundren, who replace Dame Carolyn McCall (off to ITV), reported improved revenues thanks to fuel hedging and the acquisition of Air Berlin – shares +4.7% on Friday.

GKN spent the week fighting off a hostile £7.4 billion takeover by Melrose.  However a £1 billion cash sweetener may turn a few shareholders’ heads.  BT lost its court case on Friday over its pension pay-out to its 83,000k beneficiaries, preserving the proposed pension increases rather than the company investing broadband infrastructure.  BT’S pension black hole is not going away; it needs attention. At the end of the week, despite a slew of challenging financial, corporate and political issues, global indices closed as follows on the week – S&P 500 +0.54%, FTSE 100 -0.62%, European bourses +0.51% on average and the NIKKEI +0.65%. Brent crude settled at $68 and change having nudged $70 a barrel and surprisingly the Dollar remained weak against most major reserve currencies (Cable $1.3890 and $/Y111.20).


UK Companies posting results this week – Monday – Revolution Bars, Carpetcenter, Lonmin, Tuesday – Pets at Home, Paragon, Dixons Carphone, EasyJet, SSP Group, Marston’s, Fever Tree, N Brown, Cairn Energy, Wednesday – Sage, Crest Nicholson, Polymetal, Fesnillo, Foxtons, WH Smith, JD Wetherspoon, Thursday – DMGT, Kier Group, Sky, Diageo, ASOS, Genel Energy, Greene King, PayPoint, Brewin Dolphin, Restaurant Group, Unilever, CMC Markets, Renishaw, St James’s Place, Kaz Minerals

US companies posting results this week – Monday – Halliburton, Netflix, Tuesday – Travelers, Johnson & Johnson, Procter & Gamble, HB Fuller, Texas Instruments, Capital One, Wednesday – Baker Hughes, Abbotts Labs, Comcast, General Dynamics, Xilinx, Ford, Dolby, Whirlpool, GE, Thursday – Caterpillar, Freeport-McMoRan, JetBlue, Raytheon, Biogen, American Airlines, £Ms, Northrop Gruman, Intel, Friday – Abbvie, Honeywell

Economic data posted this week – Tuesday – US PSBR, CBI Industrial trends, Wednesday – UK Labour statistics, US PMI Manufacturing & Services, Thursday – ECB Monetary policy, Friday – US GDP, UK GDP, US Durable orders.


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


I failed to understand the logic behind yesterday’s very sharp rally on the Street of Dreams, with the DOW and NASDAQ both up over 1%. Two colleagues of mine chirped up in unison not to try too hard to work it out. There was neither ‘rhyme nor reason’ for it, apart from the fact that it was just replacing the exaggerated pull-back from a couple of days ago. Punters think that the earning season will hit targets – hence record levels on Wall Street were being titillated, despite Goldman disappointing with its trading operation with revenues down 30%. However they still beat forecast, but the shares drifted by 2.5%. Bank of America Merrill posted very acceptable progress. These shares are up over 200% in the last year! What an investment and such a recovery play! The content of the Beige Book seemed irrelevant to equity acolytes. Asia did not know quite what to make of Wall Street’s performance yesterday, this morning. In fairness it was preoccupied with China’s retail and GDP data, which was near enough in line with expectation, though there was little hue about of the colour blue!


Here in London, the main index made insignificant progress at the opening with little news to break up the tedious monotony of recent sessions. By 2.45pm it had drifted by 39 points to 7686. Why? The strength of Sterling helped the drift with the likes of Reckitt Benckiser, Unilever and Diageo easing some value. Mining stocks, with the exception of Glencore were quite friendless in the ring. Oil stocks were neutral – strong £ played a rising oil price.


There were a slew of earnings today. Whitbread’s Alison Brittain posted encouraging figures. Though until yesterday, Whitbread was down 6% in the last year, their shares rose by 4% today. AB Foods disappointed and it wasn’t Primark – sales up 7% in the last quarter, sugar sales were disappointing. As for the rest they performed as follows – Headlam +1%, GKN -0.4%, William Hill unchanged, Experian -1%, Halfords -1%, Royal Mail Group -1.5%, Evraz +2% Pearson -0.5% and Finsbury Foods unchanged.

At 2.45pm the DOW is down 10 points. IBM and Morgan Stanley have posted results. Morgan Stanley pleased their acolytes – shares up 0.8% and as for IBM the market’s stance was neutral – unchanged.

TODAY’S FAYRE – Thursday, 18th January 2018



“I speak not, I trace not, I breathe not thy name;
There is grief in the sound, there is guilt in the fame;
But the tear that now burns on my cheek may impart
The deep thoughts that dwell in that silence of heart.
Too brief for our passion, too long for our peace,
Were those hours – can their joy or their bitterness cease?
We repent, we abjure, we will break from our chain, – 
We will part, we will fly to – unite it again!
Oh! thine be the gladness, and mine be the guilt!
Forgive me, adored one! – forsake if thou wilt;
But the heart which is thine shall expire undebased,
And man shall not break it – whatever thou may’st.
And stern to the haughty, but humble to thee,
This soul in its bitterest blackness shall be;
And our days seem as swift, and our moments more sweet,
With thee at my side, than with worlds at our feet.
One sigh of thy sorrow, one look of thy love,
Shall turn me or fix, shall reward or reprove.
And the heartless may wonder at all I resign – 
Thy lips shall reply, not to them, but to mine.



George Gordon, Lord Byron – poet – 1788-1824



Ben Stokes – I am truly surprised that Cricket’s ECB/TCCB has granted Ben Stokes permission to play in the 20/20 tournament in New Zealand.  I know the CPS has taken an inordinate time to prefer charges of affray against Ben Stokes, but these allegations are quite serious in terms of the law; so for the ECB to allow him to play for England until there is total clarifications on the outcome of a trial or hearing, has quite surprised me. Perhaps the ECB feels that Stokes has been unfairly discriminated against in terms of the time taken by the CPS to bring charges and his forthcoming appearance at the Crown Court. There was also a rumour that Stokes might sue the authorities for wrongful dismissal, but I have my doubts of its validity.


This Carillion debacle has been a pretty tawdry affair.  The Government, with the opposition snapping at their heels and baying for blood, as if Labour were as pure as the driven snow in this arena, will need to have the drains up over the performance and behaviour of its management. Did they behave recklessly bordering on criminally and will their bonuses have to be clawed back?


However I never thought I would live to see the day when a Conservative Government seemed somewhat ambivalent to towards small companies and businesses in the manner it has responded to those suppliers and sub-contractors caught up in the Carillion crisis. It is absolutely correct that Carillion should not be bailed out by the taxpayer; the shareholders and the banks should bear the pain. However to convey the impression that the small fry should be metaphorically thrown to the wolves is unfair.  They should have some help in regards to issues that were beyond their control. Also laws need to be brought in whereby bills and accounts should be rendered and paid with 28 days of being issued, except on a mutually agreed alternative basis.  It is a scandal that large companies just refuse to meet their obligations within a reasonable time frame.  Small companies are the backbone of growth in this country and they need careful and responsive help. 


We have heard a great deal of carping from Jeremy Corbyn about how public sector work should be wholly run by the state! What nonsense! Had Carillion been state owned it would have cost the taxpayer a fortune to prop it up as it continued to fail and demand more and more in subsidies. Sound familiar?


There was an excellent article in the Guardian today, very well researched on the likelihood that taxpayers may need to foot a £200 billion bill for 700 existing PFI contracts, which could run over the next 25 years according to the National Audit office. It is their measured opinion that the cost of privately financing public projects could be 40% higher than relying on the public sector. I am sure some of the figures are accurate but I do not endorse the sentiment or believe in the prognosis. Civil servants tend not to have very much commercial ‘savvy’ and I suspect the profligate demands made by the Unions over the years and the necessity for extra subsidies would have been gargantuan – way ahead of private enterprise costs. The current system is not wrong. It was the poor management of Carillion and indifferent due diligence done on the company by government bodies that triggered this debacle.


Yesterday the Street of Dreams scrubbed up well for a great earnings season party, as the 3 main indices broke new ground. In fact Wall Street was on fire. Not even the dispiriting performance on trading, particularly bonds, made by Goldman Sachs could keep the momentum at bay. Trading revenues were down 30% on last year and 50% below the annual $45 billion revenues of 2009. Oil & gold bounced in to the bargain. The markets closed as follows – DOW +1.25%, S&P +0.94%, NASDAQ +1.03%.


In Asia this morning markets were relatively subdued as investors waited China’s GDP and retail sales data – last quarter’s GDP slowed to 1.6%, YoY and YTD hold at 6.8% and 6.9% respectively; Retail Sales dropped to 9.4% YoY; Industrial Production ticked up to 6.2% YoY; FIA held at 7.2% YoY. Markets closed as follows – ASX unchanged, Shanghai +0.8%, Hang Seng +0.5%, Nikkei -0.5%.


London’s leading index, yesterday felt moribund – down 30 points at 7725. GKN’s takeover problems and Rolls Royce’s restructuring plans presented with gusto by CEO Warren East were well received by investors – shares up 4% to 900p having initially been 7% to the good after the news broke. Since those dark days of bribery allegations concerning $671 million, the shares cascaded down hill to 513p in November 2015 exacerbated by profits warnings, from 1271p in June 2014. There is little doubt that East’s predecessors, Sir John Rose was probably in situ as CEO for too long (12 years) and the same applies to John Rishden for similar reasons. Rolls Royce was badly in need of fresh ideas and initiatives. The grass was growing under the feet. Warren East ticked all those boxes and has delivered a fresh approach to this brilliant brand. RR is cutting the company down from 5 to 3 divisions and will hopefully be selling its marine operation. GE, Wartsila and Siemens are amongst possible suitors.


Melrose has gone hostile to acquire GKN for £7.4 billion. Anne Stevens insists the bid grossly undervalues the company in terms of asset value. Cineworld announced a £1.7 billion rights issue to buy Regal of the US. There was a slew of earning this morning, set out below. None of them really struck a positive or negative chord. London’s leading index was down 30 points at 7798 at 11.00am.



UK Companies posting results this week – Thursday – Evraz, Experian, Pearson, Royal Mail Group, William Hill, AB Foods, Headlam, Halfords, Workspace, Whitbread


US companies posting results this week – Thursday – Morgan Stanley, Bank of New York Mellon, IBM, American Express


Economic data posted this week – Wednesday – US Beige Book, US Industrial Production, Thursday – US Housing data, Friday – UK Retail Sales



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 ​


Though inflation data for December was marginally encouraging – down from 3.1% to 3%, the news from the front on Carillion looked dire.  Many people working for the small suppliers look like they are financially dead and buried. One hoped that the Government would have seen how important the small suppliers in the chain they are to us. But it does not look good.  I must say I get very irritated to hear the likes of Rebecca Long-Bailey – the opposition spokesman talking unhelpful drivel on the subject. However I have some sympathy with her over her frustration with the government and their inability to head off the inevitable collapse of Carillion after the profits warning.  I am sure the Government would have loved to, but the dye was cast months before that! It seems that 20k jobs are looking decidedly vulnerable.

London’s largest index is down 22 at points 7746 at 3.45pm. Trading has been sepulchral with little movement amongst the large cap stock.  BP shareholders did not enjoy the $1.7 billion cash call from the Deep Water Horizon nightmare.  This saga appears to be a bottomless pit. Shares are currently down 3%. Dunelm disappointed its acolytes –shares down 4.5%. Spire was 2% lighter and Ashmore eased by 1%

Those in the ascendency were Premier Food +3%, JD Sports with a profits upgrade from to £270 to £295m.  Greggs’ sausage rolls remain omnipotent – +1.5%.  The surprise package of the day was UBM with an upgrade – +5%

The Street of dreams breached the 26k threshold adding 260 points to 26058 Citogroup posted decent numbers – +1% but hardly barnstorming but they did not disappoint. Earnings season gets under way next week.


TODAY’S FAYRE – Tuesday, 16th January 2018



“Think’st thou I saw thy beauteous eyes,
Suffus’d in tears, implore to stay;
And heard unmov’d thy plenteous sighs,
Which said far more than words can say?

Though keen the grief thy tears exprest,
When love and hope lay both o’erthrown;
Yet still, my girl, this bleeding breast
Throbb’d, with deep sorrow, as thine own.

But, when our cheeks with anguish glow’d,
When thy sweet lips were join’d to mine;
The tears that from my eyelids flow’d
Were lost in those which fell from thine.

Thou could’st not feel my burning cheek,
Thy gushing tears had quench’d its flame,
And, as thy tongue essay’d to speak,
In sighs alone it breath’d my name.

And yet, my girl, we weep in vain,
In vain our fate in sighs deplore;
Remembrance only can remain,
But that, will make us weep the more.

Again, thou best belov’d, adieu!
Ah! if thou canst, o’ercome regret,
Nor let thy mind past joys review,
Our only hope is, to forget!” 


George Gordon, Lord Byron – poet – 1788-1824



“Three Billboards outside Ebbing, Missouri” – what a film!  It had absolutely everything – depravation, love, hatred and excitement.  This film was very ‘left-field.’ It is hard to draw analogy.  I suppose the nearest comparison is probably ‘Fargo’ which had the same star turn from Frances McDormand.  For her performance as Mildred Hays a distraught mother of a young girl, who was killed and raped, who is determined to seek justice by forcing the local sheriff to take a greater interest, must surely land her the spoils as best actress for an Oscar and a BAFTA. Her facial expressions, her dishevelled look, her despair and her turn of phrase culminate in a brilliant portrayal.  The film is beautifully directed by Martin McDonagh. It also stars Woody Harrelson and Sam Rockwell, who in my opinion would both be worthy nominees for best supporting actor.  


So finally Ben Stokes is going to be charged with an affray. Therefore the likelihood of England having his services next summer looks fairly remote to me. The trial is unlikely to take place before June knowing the CPS’s track record for urgency.



In London yesterday, it was all about CARLILLION!  What a shambles! What a disgrace! This services/building contractor titan – a mongrel of Tarmac, McAlpine and John Mowlam was £900 million in debt and has built up a £600 million pension black hole, which when once the PPS has been brought in to play could cost the beneficiaries 20% of their benefit. The Government, according to David Lidington, was aware that after the July profits warning, Carillion could be in difficulties and that the government had supposedly had made some contingency plans.  However many of the sub-contractors have not been paid and are unlikely to be paid as a result of Carillion going in to liquidation. This disaster highlights the dangers of private enterprise and the public sector working together particularly when prisons and hospitals are involved.  Also Carillion manages 32000 meals a day. Why were Carillion awarded contracts, after the government suspected the company was in difficulties?  Did they think that by awarding big new contracts would mean that the banks might feel obliged to bail the company out? Well it was not to be.


Clearly many of these 450 contracts were very poorly priced. Reckless behaviour by the management to secure contracts they could surely not afford to deliver with a profit, helped bring the company to its knees. There also seems to have been a considerable element of management avarice, greed and negligent behaviour bordering on criminal. One wonders what Philip Green, chairman and the former CEO Richard Howson and his team at Carillion were up to! Such bonuses and remuneration were totally unwarranted. These, I fear, will need to be recouped! Bernard Jenkin, MP, Chairman of the Public Administration and Constitutional Affairs Committee, announced a full inquiry in to this debacle and the whole question of government contracts with public sector requirements. Clearly the banks and the shareholders will take the greatest hits.


The banks which include, Barclays, Santander, HSBC and Lloyds are expected to write off circa £2 billion. Builders such as Galliford Try and companies like Speedy Hire and Balfour Beatty will also suffer. Shareholders are expected to take a £580 million loss, but the greatest tragedy of all will be the losses taken by small firms which could be in the thousands which could lose over £1 billion. Let’s hope the drains come and those responsible are brought to book. Neither political party come out of this controversy with much in the way of their reputations in tack.



Yesterday was Martin Luther King Day – a holiday in the US out of respect for the greatest civil rights leader probably of all time! London’s main index was down a parsimonious 9 points at 7769. Activity was minimal with a few interesting companies such as Bodycote (+3.4%) and Gem Diamonds (+15%) putting in eye catching performances. GKN, with predators hovering around it like bees round a honey pot, hit an all-time high at 437.4p – up 4.14% on the day. BP is to take an extra $1.7 billion charge to settle Deep Water Horizon. Shares might dip 0.5% early on – Considered insignificant in the grand scheme of matters The Pound hit $1.38, its highest level since the referendum result in June 2016. It was down to the interest rate hike and the strength of crude oil (Brent $70 a barrel) which has taken the sheen off the Greenback. This morning UK inflation is posted. 3.1% is likely to be maintained because of the price of oil, but inflation should drop by the summer/autumn, if Sterling maintains its current level.


This morning Asian bourses were mainly higher due to the weakness of the Dollar and a strong flow of foreign funds in to the region. The ASX closed down 0.47% with the NIKKEI, despite the strength of the Yen closed up 1% – a 26 year high. At lunchtime the Shanghai Composite was 0.55% to the good and the Hang Seng was blazing the trail in adding 1.6% by lunchtime.


In London this AM there has been a slew or earning this morning. Two may be worthy of special mention due to a time factor of mine. JD Sports have upgraded the profit forecast from £270m to £295m – share may rally by 2%. They have risen from 98p in June 2015 to 365p. Also Premier Foods though their shares have drifted from 60p 15 months ago to 42p, it looks as though life is improving with group sales up 4%. Maybe the new initiatives with Nissin and Mondelez are helping stimulate sales.



 UK Companies posting results this week – Tuesday – NCC Group, Ashmore, Johnson Matthey, JD Sports, Dunelm Group, Ophir Energy, HIS Markit, Greggs, Premier Foods Wednesday – BHP Billiton, Burberry, Hochschild Mining, Thursday – Evraz, Experian, Pearson, Royal Mail Group, William Hill, AB Foods, Headlam, Halfords, Workspace, Whitbread,


US companies posting results this week – Tuesday – Comerica, Citigroup, CSX Group, Wednesday – Bank of America Merrill Lynch, Goldman Sachs, Thursday – Morgan Stanley, Bank of New York Mellon, IBM, American Express


Economic data posted this week – Tuesday – UK inflation and UK House Prices, Wednesday – US Beige Book, US Industrial Production, Thursday – US Housing data, Friday – UK Retail Sales



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 – Sunday, 14th January 2018



“When I have fears that I may cease to be
Before my pen has glean’d my teeming brain,
Before high-piled books, in charactery,
Hold like rich garners the full ripen’d grain;
When I behold, upon the night’s starr’d face,
Huge cloudy symbols of a high romance,
And think that I may never live to trace
Their shadows, with the magic hand of chance;
And when I feel, fair creature of an hour,
That I shall never look upon thee more,
Never have relish in the faery power
Of unreflecting love; – then on the shore
Of the wide world I stand alone, and think
Till love and fame to nothingness do sink.”


John Keats – poet – 1795-1821


It is not remotely surprising that President Trump has grabbed many a headline this week – from going cold on a NAFTA trade deal to refusing to come to UK to open the new US embassy to some very tawdry and undiplomatic expletives on African and Caribbean countries, again described by him as ‘fake nooze!’ Donald Trump has now been POTUS for 14 months and maybe we should reflect on what the dynamics were that took President Trump to the White House. But for the US voting system, he would probably never have made it to that big White House on Pennsylvania Avenue. In November 2016 President Trump won the popular vote in 47 states by circa 4 million votes. Mrs Hillary Rodham Clinton had a majority in 4 states, which included, New York and California of circa 7 million votes. As has been evident, never has the US been more divided politically than it is now. It makes the altercations surrounding ‘BREXIT’ look like a vicarage tea party in comparison to those who support Trump on the eastern seaboard and California, and those in that area who cannot abide him at any price.   The power amongst the NEO-Liberal Democrats is currently too thinly spread, with the New York area and most of the west coast apoplectic over Trump’s behaviour and attitude. Unorthodox behaviour or not, Mr Trump still has great support for his anti-establishment policies.

‘Holier than thou’ peripheral and parochial politicians like Mayor Khan need to pipe down, whilst governments in Europe and UK find a way diplomatically of trying to accommodate the US for trade and defence reasons, whilst never tolerating or condoning behaviour unbecoming of an international leader of such humongous importance! 

Joe Wright’s film ‘Darkest Hour’ was everything it was cracked up to be – high octane emotion, exhilarating, exciting with terrifying ramifications. The acting was off the scale. If Gary Oldman does not grab the Oscar and the BAFTA for best actor next month, then the voting has been rigged! His performance was stunning – the attention to detail was outstanding – his walk, the cigar, the barrel loads of whisky he drank, the voice intonation, the waspish look and the tears. They were all there. Oldman is a genius. What a versatile performer he is. Many of you will remember his portrayal of a drug-filled hoodlum playing opposite Jean Reno and Natalie Portman in ‘Leon’ – one of my all-time favourite action films.

The supporting roles played by Kristin Scott-Thomas (Clemmie), Lily James (the secretary Miss Leighton), Stephen Dillane (Halifax), Sam West (Eden), Ronald Pickup (Chamberlain) and Ben Mendelsohn (King George VI) were exquisitely acted! The only part of the film that disappointed me was the music. It did not tug at the heart strings! Under no circumstances must this film be missed!


Apart from Tokyo’s Nikkei, which suffered at the hands of a strong Yen (-025%), most global indices made steady, if uninspiring progress last week, with at one-time the DOW, S&P and FTSE all hitting record levels. The S&P ended the week up 1.37%, the FTSE was 0.7% to the good and European bourses added an average of 0.35%. Is the bubble going to burst? Admittedly the P/E ratios look quite rich for some peoples’ blood, but until there is evidence that QE is being aggressively tapered and interest rates are heading sharply north the prospect for more than a 5-7% downward correction seems unlikely. Bond yields have been slowly rising in the last couple of months, but insufficiently to put equity markets’ noses out of joint.  The Bank of Japan and the ECB have made very gentle efforts to taper bond renewals, but the rate has been benign. The Dollar has been weaker with Sterling looking quite perky at $1.36 and change.


However a poor 4th quarter earnings season in the US could soon wipe any sign of a Giaconda smile off many a punter’s face. The earning season started on Friday when JP Morgan Chase and Well Fargo posted better than expected efforts, though investment banking profits at JPM had fallen by 30%. However the proposed tax cuts will greatly enhance profits figures for these institutions going forward.  The fact that JP Morgan’s share price had increased by 47% since Election Day on 8th November 2016 and Wells Fargo by 40%, despite their problems, expectations were very high.  Investors were not disappointed, but were relieved. Oil has kept climbing with Brent crude nudging $70 a barrel, it highest level since 2014, when it briefly hit $115 a barrel.  Geopolitical issues in Iran and North Korea continue to provide momentum for this escalation in the price.


Last week equity markets were dominated by sales and trading updates from the UK’s main retailers.  They proved to be a very mixed bag – the good the bad and the ugly! Lidl and Aldi continued to snap at the heels of the main supermarkets, both enjoying excellent holiday sales. Boohoo and Quiz from the cheap, fashionable and cheerful brigade continued to maintain their attraction for the young. Primark, I suspect will produce the same sort of progress, when it reports on Thursday. ASOS is proving great successes on-line. Card Factory had a shocker and the outlook for House of Fraser, Debenhams, Mothercare and Moss Bros looks dire. Next’s efforts saw some improvement, but only on line, but it was significant (+13.4% for the Directory). Tesco fell a little short of expectation despite like for like sales coming in at +2.3%.  The disappointment expressed by the market dragged its new bedfellow Booker down as well. Sainsbury’s effort of an increase by 1.1% was OK but hardly spectacular. Morrison continued its resurgence under Dave Potts in posting a 3.7% increase in sales for the previous 6 week. For me the major disappointment was M&S, whose plight will not change until it stops selling dowdy fashions.  Also good though its food is, it is expensive – overall sales down for Christmas period by 1.4%. This may be work in progress, but Messrs Norman and Rowe are going to find a little magic to pull the business round.  Dunelm report on Tuesday and Halfords on Thursday and Kingfisher in a few weeks. With inflation running ahead of wage inflation, thus the consumer having less disposable income, the retail arena going forward looks tough and challenging. Price and fashion is all that matters.


It would appear to be the last throw of the dice for the construction magnate Carillion, whose share price has fallen 93% in recent months.  However it has so many badly priced government contracts for schools hospitals, prisons and defence homes and the likes of HS2, their banks and shareholders are in a real bind as to what to do.  Carillion’s debt is £900 million and the pension black hole is £600 million. Surely the public/taxpayer should not pick up the tab?  The banks and shareholders will need to take a haircut, whilst the Government helps to restore them to health or the company or assets are sold, which seems a very unlikely option. Time is running out as is the cash. So many government departments are involved, it strikes me that a rescue operation is essential until contingency plans can be made for the company and 20k plus people that are employed by Carillion and its subcontractors.


Having rejected a £7 billion bid Melrose Industries (405p a share 80% and 20% cash), GKN, the plane and car parts maker, is considering other options apart from breaking the company up.  It appears that CEO Anne Stevens may also have to fend off an approach from the Carlyle Group. GKN supplies Airbus, Mercedes and Jaguar Land Rover. Many will recall that Carlyle was criticised for its handling of and participation in the IPO of Qinetiq.


UK Companies posting results this week – Monday – Rio Tinto, Acacia Mining, Tuesday – NCC Group, Ashmore, Johnson Matthey, JD Sports, Dunelm Group, Ophir Energy, HIS Markit, Greggs, Premier Foods Wednesday – BHP Billiton, Burberry, Hochschild Mining, Thursday – Evraz, Experian, Pearson, Royal Mail Group, William Hill, AB Foods, Headlam, Halfords, Workspace, Whitbread,

US companies posting results this week – Tuesday – Comerica, Citigroup, CSX Group, Wednesday – Bank of America Merrill Lynch, Goldman Sachs, Thursday – Morgan Stanley, Bank of New York Mellon, IBM, American Express

Economic data posted this week – Tuesday – UK inflation and UK House Prices, Wednesday – US Beige Book, US Industrial Production, Thursday – US Housing data, Friday – UK Retail Sales

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 – Thursday, 11th January 2018



As Hermes once took to his feathers light,
When lulled Argus, baffled, swooned and slept,
So on a Delphic reed, my idle spright
So played, so charmed, so conquered, so bereft
The dragon-world of all its hundred eyes;
And seeing it asleep, so fled away,
Not to pure Ida with its snow-cold skies,
Nor unto Tempe, where Jove grieved a day;
But to that second circle of sad Hell,
Where in the gust, the whirlwind, and the flaw
Of rain and hail-stones, lovers need not tell
Their sorrows. Pale were the sweet lips I saw,
Pale were the lips I kissed, and fair the form
I floated with, about that melancholy storm.”


John Keats – poet – 1795-1821



Rather than a slew of platitudes pouring from the lips of PM May, let’s hope some reassurance for the future of the City of London post-BREXIT comes from within the portals of No: 10 after today’s meeting of bankers with the PM, to stop the likes of Goldman’s Lloyd Blankfein and other committed ‘REMAINERS’ from constantly carping and moaning!


Let’s hope Philip Hammond and David Davis fare well in Brussels today, where the Times tells us that there is a chink of light at the end of the tunnel for the City. Subject to a fee being forthcoming UK banks may be granted entry in to the single market. Will it be a fee worth paying?


I appeared on BBC Biz-Live this morning and was privileged to watch Miriam Gonzalez, wife of Sir Nick Clegg, telling the country of her frustrations with the UK government for failing to set out cogently what plans it had for BREXIT. Though M/S Gonzalez is not of my political persuasion, she is undoubtedly very smart and a very able negotiating lawyer. I have been told that she would have been a superb lead negotiator for the UK government on BREXIT. She was probably not considered because of her passionate political leanings – a pity as the government is short of negotiators


Yesterday markets in the US and this morning in Asia were not exactly moribund, but uninteresting, as investors digested China’s threat not to be so supportive in buying US Treasuries and to the negative comments made by President Trump on a NAFTA trade deal.


This morning in London, it is the culmination of the retail holiday season for the high Street for posting Christmas and holiday trading statements. They have been good, bad and ugly! Ugly – Card Factory down 15% (a dire profits warning), – Bad – M&S -6.5%, Booker -4.5%, House of Fraser (unquoted), Disappointing – Tesco -4.5%, Good John Lewis Partnership (unquoted sales +1.5%) and Boohoo +1%, with revenues for the brand +25%.


Now let’s look at M&S – first the history of the High Street’s favourite son. Firstly what a mistake to withdraw the St Michael’s label! What a brand! Secondly M&S has only breached the £1 billion profit barrier twice 1997 and 2007 under Lord Stuart Rose’s stewardship. This year £650 million is nearer the mark. M&S’S share price hit its zenith in May 2007 743p. Since that day it has been downhill all the way, except for a euphoric bounce in June 2015, which did not last long. Give Marc Bolland, the then CEO, his due – the Prince of PR! Gone are the days when the ‘King of Gowns & Blouses’ Sir Philip Green aspired to buy M&S for 400p in 2004.


As we all know the problem has been dowdy fashions. Retail clothes operators under huge pressure from Primark, Boohoo, Quiz and H&M – all cheap, fashionable and cheerful, cannot possibly afford to promote fashions for grandparents and expect to make money. People who look like me – pear shaped – are hardly known for their sartorial elegance. Until M&S realise that the dynamics of the high street have changed, it will remain under the cosh. People don’t buy expensive clothes. They like chinos, shorts, sneakers and Bobbie socks – cheap and cheerful. People spend their money on entertainment and holidays. Chairman Archie Norman,  who is a great retail guru and CEO Steve Rowe – Wake up and smell the coffee! Maybe it is work in progress. If not, God help you! The nuts and bolts for the last trading quarter look like this – like for like sales -1.4% – Food -0.4% and general merchandise -2.8%. Shares are down 6.5% at 303p!


And so to Tesco, whose shares over the last year have hardly moved – about 4% down – today -4.4% to 202.50. CEO, Dave Lewis has done a good job tidying up this operation, particularly post the £250m over statement of profit in December 2014. However coming in to Christmas expectations were higher than what was achieved. Like-for-like sales for the 19 weeks to 6th January 2018 were up only 2.3%. Something north of 2.5% was expected. The acquisition of Booker will soon be bedded down, but it may be a few months before the real benefit is felt.


Finally take a ‘shufty’ at Lidl – sales up 16% over near enough the same period. Customers bought 6k tons of sprouts, 17 million mince pies and 800,000 litres of champagne and prosecco. Another 43 outlets have been opened in the last year to 693. Tesco, Morrison, Sainsbury Lidl and Aldi are not going away! As I write the FTSE 100 is up 10 points at 7760 at 12 noon.


UK Companies posting results this week – Thursday – Boohoo, Fenner, M&S, Barratt Development, Hays, Moss Bros, Mothercare, Premier Oil, Spire, Tesco, Booker, Rathbones, Ultra Electronics, Card Factory – Friday – Bovis Homes, TP Icap, Countrywide


US companies posting results this week – Thursday – Delta Airlines, Friday – JP Morgan Chase, Wells Fargo, Blackrock


Economic data posted this week – Thursday – BOE UK Credit Conditions, US PPI, Friday – US CPI, US Retail Sales


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 – Wednesday, 10th January 2018



“A thing of beauty is a joy for ever: 
Its loveliness increases; it will never 
Pass into nothingness; but still will keep 
A bower quiet for us, and a sleep 
Full of sweet dreams, and health, and quiet breathing. 
Therefore, on every morrow, are we wreathing 
A flowery band to bind us to the earth, 
Spite of despondence, of the inhuman dearth 
Of noble natures, of the gloomy days, 
Of all the unhealthy and o’er-darkn’d ways 
Made for our searching: yes, in spite of all, 
Some shape of beauty moves away the pall 
From our dark spirits. Such the sun, the moon, 
Trees old and young, sprouting a shady boon 
For simple sheep; and such are daffodils 
With the green world they live in; and clear rills 
That for themselves a cooling covert make 
‘Gainst the hot season; the mid-forest brake, 
Rich with a sprinkling of fair musk-rose blooms: 
And such too is the grandeur of the dooms 
We have imagined for the mighty dead; 
An endless fountain of immortal drink, 
Pouring unto us from the heaven’s brink.”


John Keats – poet – 1795-1821



After yesterday’s shambolic Cabinet reshuffle today’s supporting cast changes seems to go rather better and without incident. However, on reflection Conservative supporters should have been delighted with the appointment of Brandon Lewis as party chairman and James Cleverly as deputy chairman. These two have significantly more appeal than recent chairman have had in gendering support for the party. They possess all the zest, verve and drive needed to turn a few million heads, which are headed in the direction of a vortex of economic despair. The Tories are purported to have only 70,000 official members as against 1.2 million that Corbyn et all have swept in to Labour’s net in the last two years. Many of them have been attracted into Labour’s ranks through “Momentum’s” acutely affective, extremely clever, offensive and poisonous social media campaign.  The Tories will always be able to raise more money than Labour through donations, but membership is hugely important if a disenchanted public are to be persuaded not to listen to Messrs Corbyn’s and McDonnell’s hollow ‘sweet nothings’ which will lead this country to penury and a lengthy dole queue, rather than to the land of ‘Milk & Honey’ which their idealistic Marxist doctrine promises!

Dispiriting comments were made on the front page of the FT, with warning shots across the bow that the EU is planning for a ‘NO DEAL’ option, which they have passed on UK industry. Many found this stance irritating, but I suppose if our government can say ‘No deal is better than a bad deal’, so I suppose can the EU. There is just an unpleasant aroma of bad faith in the wind!


After a disappointing start to the week, when results and news concerning the likes of Mothercare, AO World and Micro-Focus took the edge of the London’s main index, resulting in it closing below the Plimsoll line when its peers in Paris and Frankfurt added 0.4%, yesterday saw London’s main index give a better account of itself, courtesy of better than excepted holiday sales by Morrison (+2.5%) which injected like into M&S (+2.4%), and Sainsbury (+3.1%). London ended the session up 34 points at 7731. Persimmon also posted decent numbers but surprisingly the shares fell by 1.2% – Why? The outlook for house builders is a little inconclusive with labour and materials being in short supply. Vauxhall announced their intention to lighten up the work force by 250 people at Ellesmere Port on top of the 400 redundancies announced last year. It was just further evidence of efficiency levels being met.

Glaxo’s CEO Emma Walmsley announced further swingeing cuts at senior management levels – 50 out of the top 125 have gone in just 283 days of her stewardship. GSK business emphasis is now focused on making and distributing blockbuster drugs. Europe’s largest drug company has not performed at all well with the share price falling 1600p a year ago to 1346p yesterday. Since Archie Norman replaced Robert Swannell as chairman of M&S, the drains have been hauled up. M&S are putting in a new sophisticated IT system initially costing £25 million though by 2022 savings of £30 million will be made. The idea behind this initiative that that M&S will become more aware of what their clients want and will buy, with hopefully useful information, which should stop the High Street’s Darling selling dowdy fashions.

On the Street of Dreams the Dow had another unimpeded run on the rails, as banks, health-care stocks rallied. The other bourses were somewhat somnolent as investors wait on Friday’s bank results. Wall Street closed as follows – DOW +0.41%, S&P +0.13%, NASDAQ +0.09%. In Asia the mood was mixed with oil on the rise, investors were circumspect – towards the close the main bourses stood as follows – ASX -0.50%, Shanghai +0.35%, Hang Seng +0.68%, Nikkei -0.13%.


There have been a slew of earnings this morning – some good, some disappointing and some worrying – At 3.30am the FTSE 100 is up 5 points at 7740. J Sainsbury +1%, Quiz+1%, SuperDry -2.5%, PageGroup +7%, Focusrite -1%, Taylor Wimpey -3%, Tullow +0.5%, Ted Baker +5.5%, Cineworld -0.5%. J Sainsbury, whose shares are down from 258p a year ago to 251p today and down from giddy heights of 573p achieved in June 2009, when Qatar acquired 26%. CEO Mike Coupe posted decent Christmas sales – +1.2% – like for like +1.1% in 15 weeks to 6th January 2018. Grocery sales grew by 2.3% and online by 8.2% and Convenience stores by 7.3%. General Merchandising and clothing also flourished. As for Argos, though lack Friday was decent, there was a feeling that Argos slightly under-performed, though synergies between Argos and Sainsbury have improved resulting profit estimates being raised from £72-77 million to £80-85 million. It’s going to be a tough year for retail, but this was not a bad effort. Taylor Wimpey saw completions up by 5% to 14541, but this was below expectations and shares subsequently were down 3%.

UK Companies posting results this week – Wednesday – SuperGroup, Quiz, Taylor Wimpey, J Sainsbury, Tullow Oil, Ted Baker, Foxton’s, InterServe, Cineworld, GoCompare, PageGroup, Thursday – Boohoo, Fenner, M&S, Barratt Development, Hays, Moss Bros, Mothercare, Premier Oil, Spire, Tesco, Booker, Rathbones, Ultra Electronics, Friday – Bovis Homes, TP Icap, Countrywide


US companies posting results this week – Wednesday – Lennar, KB Homes, Thursday – Delta Airlines, Friday – JP Morgan Chase, Wells Fargo, Blackrock


Economic data posted this week – Wednesday – UK Industrial Production, Manufacturing and Construction, NIESR GDP estimate, UK Trade Balance, Thursday – BOE UK Credit Conditions, US PPI, Friday – US CPI, US Retail Sales


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 – Monday, 8th January 2018



Bright star, would I were steadfast as thou art! – 
Not in lone splendour hung aloft the night,
And watching, with eternal lids apart,
Like Nature’s patient sleepless Eremite,
The moving waters at their priestlike task
Of pure ablution round earth’s human shores,
Or gazing on the new soft fallen mask
Of snow upon the mountains and the moors –
No -yet still steadfast, still unchangeable,
Pillowed upon my fair love’s ripening breast,
To feel for ever its soft fall and swell,
Awake for ever in a sweet unrest,
Still, still to hear her tender-taken breath,
And so live ever -or else swoon to death.” 


John Keats – poet – 1795-1821


Taking nothing away from Australia’s merciless performance, but England just capitulated at the SCG this morning – all out for 180 losing by an innings and 123 runs to an altogether superior outfit. Quite a pathetic effort!

It is understandable why Christopher Plummer and Michelle Williams were nominated for Global Globe awards for their respective performances in Ridley Scott’s film ‘All the Money in the World’, which incidentally they did not win.  This movie tells the story of the kidnapping of Paul Getty junior in Italy for $17 million back in 1973.  Both portrayals were very much the highlight of what was a very boring and unconvincing script. It should have been a very exciting film. Sadly it backfired like a damp squib. Kevin Spacey, regardless of his misdemeanours, would surely have been badly miscast as J-PG. Remembering John Paul Getty’s image as I do, Plummer looked the part and portrayed the perception of the richest and most parsimonious man in the world at that time exquisitely.  Well done to Gary Oldman for winning best actor in ‘Darkest Hour.’

It has been another quite astonishing week for investors, considering the amount of corporate news was very limited. President Trump was at his most vociferous if not particularly loquacious, in exchanging jingoistic rhetoric with Kim Jong Un before the year was a week old. As if that was not sufficient, then came Martin Wolff’s embarrassing tome – ‘Fury & Fire’ – about a dysfunctional White House, which attracted a wave of abusive and dismissive invective from the President on ‘twitter.’ Despite all this embarrassing infantile behaviour, markets feel that the US economy is in good shape and all three indices burgeoned their way to new record with the DOW breaching the 25k threshold and the S&P the 2700 threshold with a bit to spare during the 4-day week.

It is interesting to note that in the last year the DOW has risen from circa 20k to 25k, with Boeing being responsible on its own for 900points in that period. 5 out of the 30 stocks have been responsible for most of the 5k points – Apple, Goldman, Caterpillar, JP Morgan and Boeing. Friday’s Non-farm payroll data was adequate – However in the last year of Obama’s Presidency, job creation was greater than under Trump in the first year of his stewardship. In passing Friday’s payroll and employment data was as follows – No-Farm payrolls created only 148k jobs in December against expectations of 190k, but the unemployment rate stayed at 4.1%. The hourly earnings rate was up 0.3% to 2.5% on an annualised – hardly stunning but constant.

Next week sees the start of the first quarter’s earnings season, which gets under way with Wells Fargo, JP Morgan and Blackrock posting significant numbers on Friday.  The way bank shares have performed in the last 3 months, the market deserves some fairly stellar results.  We shall see! Investors and punters alike seem to refuse to accept that equity and bond markets may be in a huge bubble, which could burst! Valuations are really rather frothy.  However until there is a clear message that rates will rise aggressively, with QE being tapered with a degree of urgency, it is hard to see more than a mildly healthy correction in the first quarter. The quality of this current earnings season will tell us a great deal.   The FED has told us to expect another two rate hikes this year and one in 2019.

Asian markets fared well last week too, though Tokyo was shut for much of the week.  However the NIKKEI returned with a flourish adding 3.5% in value on Thursday to its highest level for 25 years. China is only expected to grow officially by 6.5% per annum, but the rest of Asia looks set fair. Those that know about these matters concerning stock picking tell me that in 2018 Tencent, Baidu & Alibaba will be all the rage!

Relatively speaking the UK and the EU were still on holiday politically, though not entirely from an economic perspective. There was good data on hourly productivity with November providing the sharpest rise since 2011. Manufacturing and the service sector were not entirely negative, but still the UK languishes behind the EU in some areas, but comparisons are often dangerous, though it does appear that Europe may have selected another gear in terms of growth, whereas the UK seems to be plodding its own weary path, thanks to uncertainty over BREXIT negotiations. Certainly many of the economists and teenage scribblers are determined that the UK is set fair on a rocky path in to the house of economic bondage.  As an observer of life, I am not sure that I subscribe to that theory.

At the end of this past week equity bourses were on particularly good terms with themselves with perhaps the FTSE’S performance being the least impressive thanks to the strength of Sterling – up just up 0.47%, with the S&P 500 being all but on fire scooping up 2.27% in the same period with European bourses being not that far behind with 2.17% added value there for all to see. The Nikkei added a whopping 4.17%, thanks to positive vibes about the resurgence of Japan’s economy. The fact that country of the ‘Rising Sun’ is hopelessly over-borrowed has hardly seen an eyebrow of concern raised.

In London most of the main news came from the retail sector.  We had unexpected good news from NEXT, which posted a 13.6% increase in its Directory sales in the last trading period, though high street sales fell by 6.4% – overall +1.5% – shares up 6% on the week.  Unfortunately Debenhams posted a disastrous profits warning – £55-65 million for the year against estimates of £82 million – shares down 17% on Thursday.  This news will have damaged Mike Ashley’s 20% holding in Debenhams and could precipitate a cheaper sales of Newcastle United to Amanda Staveley’s consortium for a price nearer £240 million than the £300 million demanded. House of Fraser looks as if sales data from their front will not be good. Carillion suffered as a result of a regulatory investigation – down 5% on the week. Tesco will post a trading statement this week on Thursday with like for like sales over Christmas and the New Year likely to have increased by 2.5%. Morrison’s effort may not have been that effervescent, out on Tuesday, but not bad with estimated sales coming in at 1.7% including Amazon. M&S post numbers on Thursday as well. Food sales will be flat but general merchandising may be up 1%. As for Sainsbury’s effort on Wednesday is likely to disappoint with sales only up 1%, with Argos perhaps not as buoyant as usual. Boohoo on Thursday and ASOS on 25th January are not expected to disappoint. Sales from Mothercare and New Look (withdrawal of credit insurance) are unlikely to smell of the most exquisite roses!

It is always fantastic to see a really professional boutique take on the big boys in their back garden.  Such was the case last week with Robey Warshaw, the M&A advisor run by Sir Simon Robey (ex-Lazard) and Simon Warshaw (ex-UBS). This company was involved in the Softbank/Arm Holdings, Liberty Global/Vodafone and Reckitt Benckiser/Mead Johnson merger deals.  We understand that £63 million of largesse was spread amongst about 18 employees. Finally the initial introduction of futures contract for Bitcoin did not immediately steady the ship, though a couple of days ago the price rallied sharply from $11k to circa $15k. This market is not for the faint hearted.  

UK Companies posting results this week – Monday – Micro Focus, AO World, Tuesday – Games Workshop, Centamin, Morrison, Persimmon, Ferrexpo, SafeStore, Wednesday – SuperGroup, Quiz, Taylor Wimpey, J Sainsbury, Tullow Oil, Ted Baker, Foxton’s, InterServe, Cineworld, GoCompare, PageGroup, Thursday – Boohoo, Fenner, M&S, Barratt Development, Hays, Moss Bros, Mothercare, Premier Oil, Spire, Tesco, Booker, Rathbones, Ultra Electronics, Friday – Bovis Homes, TP Icap, Countrywide

US companies posting results this week – Monday – American Eagle Outfitters, Tuesday – Simply Good Foods, Wednesday – Lennar, KB Homes, Thursday – Delta Airlines, Friday – JP Morgan Chase, Wells Fargo, Blackrock

Economic data posted this week – Monday – US Consumer Confidence, US Consumer Credit, Wednesday – UK Industrial Production, Manufacturing and Construction, NIESR GDP estimate, UK Trade Balance, Thursday – BOE UK Credit Conditions, US PPI, Friday – US CPI, US Retail Sales


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