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


One thought on “THE LAST TODAY’S FAYRE

  1. Kevin Hough says:

    Many thanks to you David. I will miss your comments, analysis and downright good sense expressed through your column. The best to you from a grey and snowy Ashby De La Zouch.

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