Category Archives: Daily Fayre

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​

 

TODAY’S FAYRE – FRANCE’S DEBILITATING RELATIONSHIP WITH UK & MARKETS

TODAY’S FAYRE – Tuesday, 18th July 2017

 

“This is the night mail crossing the border,

Bringing the cheque and the postal order,  

 

Letters for the rich, letters for the poor,

The shop at the corner, the girl next door…  

 

Letters of thanks, letters from banks,

Letters of joy from girl and boy,

Receipted bills and invitations

To inspect new stock or to visit relations,

And applications for situations,

And timid lovers’ declarations,

And gossip, gossip from all the nations,

News circumstantial, news financial,

Letters with holiday snaps to enlarge in,

Letters with faces scrawled on the margin,

Letters from uncles, cousins, and aunts,

Letters to Scotland from the South of France,

Letters of condolence to Highlands and Lowlands

Written on paper of every hue,

The pink, the violet, the white and the blue,

The chatty, the catty, the boring, the adoring,

The cold and official and the heart’s outpouring,

Clever, stupid, short and long,

The typed and the printed and the spelt all wrong.”

 

 

WH Auden – poet – 1907-1973

 

 

There wasn’t a great of comment in the press about Marin Cilic capitulation against Roger Federer in the Wimbledon final. From my perspective I think Cilic was completely overawed by the occasion, which caused him to freeze, dissolving him into tears.  Croatians are an emotional race so I venture to suggest that raw emotions were his downfall rather than some spurious blister on his left foot! Anyway, take nothing away from Federer’s amazing achievement. I cannot see that record ever being superseded.

 

Perhaps I am just feeling a little vulnerable, but I am finding the aggression, arrogance and excess of confidence being adopted by Messrs President Emanuel Macron, PM Edouard Philippe, Pascal Lamy, Christian Noyer and Michel Barnier towards the UK nauseating in the extreme. For the avoidance of doubt, Paris, to date, is a Mickey Mouse financial centre in comparison to London.  It will be a task of Herculean proportions to compete on level terms with London. If I know the City, it will be up for the fight, regardless of remedial action to be taken by JP Morgan, UBS, HSBC, Goldman, Citbank and others! France’s attitude slightly concerns me as it could lead to other reprisals in our relationship, which could be damaging all the way around as sovereignty in the UK’S case and Federalism in the case of France and the EU take a firmer vice like grip. The UK has no major issues with France, though ‘entente cordial’ seems to be dissipating very quickly. The UK’S problems are with the EU. My hopes and dreams all presuppose that the UK Government and its dissenters start to grow up and behave in a manner expected from people in positions of authority.

 

There was an interesting piece in the Guardian yesterday on cyber security inspired by comments made by Inga Beale the CEO of Lloyds of London. She has warned that unless cyber security is tightened up, it could cost the world $120 billion (worst guess). ‘Hurricane Katrina’ cost $108 billion in 2005 as the largest single natural disaster. M/S Beale has indicated that a hack on a cloud service could cost as much as $53 billion and attacks on computer operating systems could create havoc to the tune of $28 billion. Governments, business, computer makers and security firms you are on your metal.

 

Wall Street had one of those nondescript sessions, thanks in the main to Congress failing to acquiesce to Trump’s Healthcare plans to replace Obamacare as well as the plunging Dollar. The main indices closed as follows with YTD performances – DOW: 21,629 -0.04% +9.448% S&P: 2,459 -0.01% +9.84% NASDAQ: 5,839 +0.03% +20.07%.

 

Health stocks on the S&P 500 slipped in yesterday’s rather anaemic session, partly weighed down by a delay in the US Senate’s consideration of healthcare legislation. The S&P health sector fell 0.3%. Procter & Gamble added 0.5% as investor Nelson Peltz actively seeks a seat on P&G’s board. BlackRock shares fell 3.1% after the world’s biggest asset manager’s quarterly profit came in below expectations.

After the closing bell, Netflix shares jumped nearly 10% following better than expected subscriber growth – up 5.2 million against expectations of 3.23 million taking the total to 36.3 million (29 million in US). 190 countries have access to Netflix and the other piece of good news is that Netflix will spend $6 billion on fresh content. Meal-kit operator Blue Apron Holdings fell 10.5% after an Amazon unit filed a trademark for a competing meal-kit service earlier this month. M&A activity continued to bubble over with diamond producer Dominion Diamond agreed to be bought by Washington Cos. for $14.25 a share, or about $1.2 billion. The company’s stock gained 59 cents, or 4.4%.

 

Despite better than expected GDP numbers in China up from 6.7% to 6.9% posted on Monday, markets were somewhat somnolent in Asia as the headed to the close as follows plus YTD – NIKKEI: 19,993 -0.62% +4.593% HANG SENG: 26,436 -0.13% +20.115% CHINA: 3,643 -0.56% +9.944% ASX: 5,682 -1.26%, +0.383%

 

 

In London yesterday the FTSE 100 gained 25 points. The initial headlines were grabbed by Reckitt Benckiser’s plans to sell food division for circa £2.2 billion to either Unilever or Hormel Foods or McCormick or Pinnacle Foods. I suspect Unilever is in the driving seat. Then it was all about Dame Carolyn McCall serving notice to leave easyJet as CEO to replace Adam Crozier as CEO of ITV next January. Lady McCall knows about the consumer and what she/he requires. She did a good job as easyJet despite scraps with Stelios over her bonuses – She is alleged to have made £30 million during her stewardship. easyJet’s shares in the 7 years she was CEO have rallied from 427p to 1400p today. Her energy and knowledge of the consumer make her a great choice. Her other quality is her strength of character. Just watching her terrifies me to death! Finally Dame Karen Brady is to chair Sir Philip Green’s operations which include Arcadia. What a portfolio – the Apprentice, West Ham United colleague of Davids Sullivan & Gold and chief barker for the King of Gowns & Blouses! Financially she is not about to suffer the slings and arrows of outrageous fortune!

 

Today at 9.45am the FTSE 100 is down points. There were decent trading statements from British Land (+2.5%), IG group (+6%), Headlam (+6%) and Royal Mail – revenues up 1% shares up 3.5%.

 

At 9.30am Inflation came in lower than expected – down from 2.9% to 2.6%. According to Simon French, Panmure’s chief economist tells me this trend is in line with the US and EU – on its way down from its zenith.

 

 

UK companies posting numbers this week – Tuesday – NCC Group, IG Group, Headlam, BHP Billiton, British Land 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 – Tuesday – IBM, Johnson & Johnson, Bank of America Merrill Lynch, Harley-Davidson, Goldman Sachs, UnitedHealth, Lockheed Martin, CSX Corpn, 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 – Tuesday – UK PPI, CPI & Retail Price indices, 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 – Sunday, 16th July 2017

 

“Behold the apples’ rounded worlds:
juice-green of July rain,
the black polestar of flowers, the rind
mapped with its crimson stain.

The russet, crab and cottage red
burn to the sun’s hot brass,
then drop like sweat from every branch
and bubble in the grass.

They lie as wanton as they fall,
and where they fall and break,
the stallion clamps his crunching jaws,
the starling stabs his beak.

In each plump gourd the cidery bite
of boys’ teeth tears the skin;
the waltzing wasp consumes his share,
the bent worm enters in.

I, with as easy hunger, take
entire my season’s dole;
welcome the ripe, the sweet, the sour,
the hollow and the whole.”

 

Laurie Lee– poet – 1914-1997

 

You have to admire President Macron’s judgement in inviting President Trump and his wife to Bastille Day celebrations. Admittedly the invitation coincided with the 100 year anniversary when the US joined WW1. The reception given to President Trump was respectful and the occasion passed without incident and one can have little doubt that it will be to France’s long-term benefit.

 

Sadly the same cannot be said or guaranteed of UK’s crowds in similar circumstances. Had President Trump paid a state visit to GB, the feisty, liberal-minded anarchists would have massed their troops and unnecessarily embarrassed the monarchy and government. Football hooliganism seems to have infiltrated across aspects of society. No one minds a peaceful demonstration but there seems to be an excess of violence that always accompanies demonstrations on these occasions!

 

With unemployment at its lowest rate since 1975 (4.5%), interest rates in the lowest cycle in living memory and the stock market within 150 points of its record, who would have believed that the U.K. would be in such a vortex of political uncertainty and despair? However, as was confirmed on Saturday morning living standards, with the exception of the wealthy, are lower than they were fifteen years ago. That of course what is not taken in to account from the Resolution Foundation’s Report is the fact that the top 1% have doubled their share of income. Their share of the income pie is 11% but their tax share is 28%! It is fair to say that the divide between those that have and those that have not is unacceptable. I am more than convinced that if the government threw the kitchen sink at the housing crisis, the gap would be measurably alleviated. Affordable housing in the current economic climate, when BREXIT could temporarily slow down the economy, is a prerequisite.

 

We have had a galaxy of wonderful of sporting fayre this weekend. The women’s Wimbledon final was a disappointing one-sided affair, with Venus Williams completely out of sorts, though take nothing away from Garbiñe Muguruza – perhaps the first of a few championships for this talented 23-year-old, who also won at Roland Garros in May. The test match at Trent Bridge was riveting. A peach of a cameo innings from Joe Root and some fine bowling by Anderson and the well-balanced South African attack. Many hope that Roger Federer wins his 7th Wimbledon title this afternoon and I am wholly ambivalent about the Grand Prix, though I expect Hamilton to win!

 

The content of Wednesday’s and Thursday’s Humphrey Hawkins lecture, delivered by FED Chairman Yellen to Congress was sufficiently upbeat about the US economy as well as dovish enough in regard to interest rate policy in the months and years to come, to allow US equities to crack on last week – the DOW was +1.8% on the week (its best week for 2 months), another record and the S&P 500 by 1.29% and the NASDAQ by a spirited 2.5% thanks to the resurgence of Amazon, which had an impressive week for its Prime service (+2.5%) and momentum from Apple (+3.4%) and Alphabet (+3.3%). Not surprisingly the Dollar retreated by 0.5% to a ten month low. Bond yields drifted back from recent sharp rises. M/S Yellen told Congress that any rate rises would be slow and gradual and that the FED would be looking to taper quantitative easing when appropriate.

 

Friday saw the start of earnings season, with three of the main banks setting down their respective stalls – JP Morgan, Citibank and Wells Fargo. Though JP Morgan recorded its highest quarterly profit of $7 billion, its trading revenues were down 19% due to lack of volatility. CEO Jamie Dimon was not very subtle when criticising the US government for its lack of innovation in terms of education, regulation and taxation reforms. Citibank also beat expectations with a profit of $3.9 billion with decent investment banking results, though revenues for foreign exchange, commodities and fixed income were down 6% and activity in equities was 11% lower for the quarter. Wells Fargo numbers were adequate but concern was expressed about costs. Wells Fargo has been taking measures to cut $4 billion from its annual expenses by 2019 and there was more work to do! Its net income rose 4.5 percent to $5.40 billion, or $1.07 per share, in the quarter, topping the average analyst estimate of $1.01. The respective shares fell as follows on Friday – JP Morgan -0.9%, Citibank -0.3% and Wells Fargo 1.1% – not a bad effort considering the incredible rally of the sector since Presidential Election day – JP Morgan up by 35%, Citibank by 37% and Well Fargo not so spectacularly by 23%. The earning season gathers momentum next week and by Friday we should have a decent idea as to the quality of the results.

 

The FTSE 100 meandered along adding a rather parsimonious 0.37% on the week, with mining and oil stocks attempting to sit up and take nourishment with BT (+4% on the week) and Vodafone (+2% until Thursday, when its share price gave up the ghost to end flat on the week) promising to improve their respective broadband services. Stephen Rowe, M&S’S CEO whispered sweet nothings in investors’ ears, about the fact that general merchandise sales were not as bad as many thought (-1.2% like for like in the last quarter) and food -0.1% in the same period.  However, even despite reassurances from the arrival of Jill McDonald from Halfords, investors were having none of it – shares down over 5% on the week to 325p, Carillion had a shocker and lost nearly 70% in value last week thanks to an awful profits warning and eye-watering level of debt (£700 million). Access to funds will need to be dealt with, sooner rather than later, to appease the market’s cynics. Carillion employs 50,000 people world-wide.  European stocks enjoyed some ebullient gains last week, with bank, drug and oil sectors all performing with some aplomb – up 1.7%. The Nikkei added a short 1% – it might have been more but for a relatively strong Yen.

 

After a very successful week for its Prime service, Amazon seems hell bent on challenging the US’S $780 billion grocery market with a plan to deliver meal-kits to peoples’ homes – so the Sunday Times tells us.  There are rumours that some key investors in Barclays want the bank to be broken up in to a retail bank and an investment bank, There is no chance of this happening until the outcome of the Qatar share transaction trial. Unilever is locked in negotiations to buy Reckitt Benckiser’s food division, which includes Coleman’s mustard and spam. If a sale takes place it might be a precursor to RB selling its homecare division as its prepares to buy Mead Johnson for $18 billion.

 

There is little doubt that the UK has a potential consumer debt crisis. 24% of lenders reported that there was a rise in credit card default payments and 30.3% of lenders say that there has been a marked increase in the default of servicing car loans and personal debt loans. This is a worrying trend, which the Bank of England will be more than aware of and has started implementing ways of controlling lending.  With a view to alleviating the pain of debt some lenders have given as much as 43 months of interest relief.  

 

UK companies posting numbers this week – Monday – Rio Tinto, Tuesday – NCC Group, IG Group, Ideagen, BHP Billiton, 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 – Monday – Blackrock, Brown & Brown, Netflix, Tuesday – Johnson & Johnson, Bank of America Merrill Lynch, Harley-Davidson, UnitedHealth, Lockheed Martin, CSX Corpn, 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 – Rightmove Housing Index, Tuesday – UK PPI, CPI & Retail Price indices, 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​

MARKET UPDATE – REPEAL BILL, THE PM & MARKETS

In the wake of yesterday’s euphoric daily rally – the best single day rally in London for a couple of months and with the DOW nudging record levels, London held on to its gains this morning adding 6 points at 7422 at 11.20am. Most people were preoccupied with the Repeal Bill on changing legislation from EU law to UK, due to be presented to the House of Commons – a bill that will cause the Government no end of grief. PM May was interviewed this morning by BBC 5-Live’s Emma Barnett. Mrs May seemed to open up to M/S Barnett, who is a good inquisitor but a tough scout. However the sound on the TV was turned down so I have no idea how the PM went down, with her body language appearing less than comfortable. It is fair to say that the BBC, to date, is not exactly a standard bearer for the PM, nor for that matter HM’S Government! So I doubt the Daily Mail’s Quentin Letts will give it 5-star ratings in tomorrow’s edition.

 

Banks were strong with both Barclays and Lloyds both adding 2%. HSBC was the laggard as it had enjoyed great sessions in recent days. BT, on a promise of a policy shakeup re broadband and its Italian operation roared ahead from lower levels by 3% to 300p – They stood at 406p a year ago! Vodafone was 2% to the good on the back of BT. Astra was down 4.5% on rumour that Phillipe Soirot the CEO is off to Israel to join Teva. Of those companies reporting today Dart Group did not pass muster with a profits warning – down 12.49%. ASOS did well and its shares were all but unchanged and Babcock International was just a smidgen below the Plimsoll line -0.27%. Dow futures were up 20 points as I speak. Markets will be waiting to see what goodies President Trump comes away with from the Bastille Celebrations.