WEEKLY FAYRE – Monday, 14th December 2020

December 14, 2020

“This is the light of the mind, cold and planetary
The trees of the mind are black. The light is blue.
The grasses unload their griefs on my feet as if I were God
Prickling my ankles and murmuring of their humility
Fumy, spiritous mists inhabit this place.
Separated from my house by a row of headstones.
I simply cannot see where there is to get to.

The moon is no door. It is a face in its own right,
White as a knuckle and terribly upset.
It drags the sea after it like a dark crime; it is quiet
With the O-gape of complete despair. I live here.
Twice on Sunday, the bells startle the sky —
Eight great tongues affirming the Resurrection
At the end, they soberly bong out their names.

The yew tree points up, it has a Gothic shape.
The eyes lift after it and find the moon.
The moon is my mother. She is not sweet like Mary.
Her blue garments unloose small bats and owls.
How I would like to believe in tenderness –
The face of the effigy, gentled by candles,
Bending, on me in particular, its mild eyes.

I have fallen a long way. Clouds are flowering
Blue and mystical over the face of the stars
Inside the church, the saints will all be blue,
Floating on their delicate feet over the cold pews,
Their hands and faces stiff with holiness.
The moon sees nothing of this. She is bald and wild.
And the message of the yew tree is blackness – blackness and silence.”

Sylvia Plath – poet – 1932-1963

In their last three matches Fulham FC seems to have started getting its act together with a win at Leicester and a commendable 1-1 draw against Liverpool at the Cottage yesterday afternoon. In fact, ‘the men in white’ were possibly unlucky not to have won, having been denied what looked like a clear penalty. So, it was frustrating to see Burnley win 0-1 at Arsenal later in the evening, dipping us back in to the relegation zone – Nil Desperandum


7th December ‘20

11th December ‘20

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Hang Seng








DEAL or NO DEAL – That was the question that was on everyone’s mind last week! There have been four and a half years of anguish, wasted opportunities and an unnecessarily high degree of acrimony, leaving the UK more divided as a nation, than it has been in living memory. Add to that uncomfortable ‘state of affairs’ an influential percentage of hostile ‘woke’ media, able and willing with their wooden spoons to stir up dissent, it did not bode well, when at this time of crisis, the country should have been pulling together more than at any time since 1939. A negative outcome could make for an unattractive toxic and grotesque cocktail of despair. Sunday was D-Day! It came and went with yet another postponement with the promise that both sides would go the extra mile. If there is ‘no deal’ the next few months could be very painful, but surely a new ‘Valhalla’ of expansive economic prosperity is there for the taking? The world waits with bated breath to see if the deadlock can be broken.

According to Simon French, chief economist at Panmure Gordon, the price of failing to agree a trade deal with the EU by 31st December was succinctly spelled out by him in words of one syllable. GDP of close to 2% next year alone could be lost, cutting £10 billion from London’s earnings alone, with a further £15 billion of lost growth over the three years to 2025. He may be right but “faint heart never won fair lady!” Personally speaking, the UK as a nation, cannot afford to think negatively about its future. Also, I venture to suggest the UK’s business, industry and commerce has had 4.5 years to prepare and make contingency plans.

The threat of a NO DEAL BREXIT trade agreement was certainly a major contributor to the rather lack-lustre performance of equities, that emanated from many investors’ inertia. The world’s inability to get on top of Covid19 also did not help the cause for optimism, which should be there in spades now that the vaccine is being administered. The Pfizer vaccine was given considerable impetus by the US’S FDA approving its use.

Had Congress, under Nancy Pelosi’s vice-like-grip on the long awaited $900 billion stimulus package been released a tad, equity markets would have responded accordingly. US initial Jobless Claims saw the worst set of figures for eleven weeks – 883K needing benefits, when 730k was the estimated requirement. US Inflation remained relatively benign at 1.2% for the year so far, with CPI coming in at 0.2% for November. 

There was ‘trouble at mill’ in the US for Facebook. The US authorities may force Mark Zuckerberg’s empire to sell Instagram and WhatsApp due to allegations that both operations are crushing competition. Facebook will vigorously defend its position.

The UK’S recent GDP data was posted last Wednesday. Growth for October came in at a parsimonious +0.4%, a far cry from the +15.5% ‘V’ shaped bounce achieved in the 3rd quarter. The service sector unsurprisingly was disappointing at +0.2%, when of course a second lockdown damaged the recovery process for hospitality, pubs, restaurants, and the travel industry. There was some encouragement from industrial production +1.3% against estimation of +0.3% and from manufacturing +1.7% against estimation of +0.3%.

Andy Haldane, the Bank of England’s chief economist also chipped in with the fact that £100 billion of savings had been squirreled away in the last eight months courtesy of the pandemic, with savings up 29% from April to June. It was only 6.8% for the equivalent period last year. This mountain of cash should contribute to the recovery once the vaccine has been utilised. Mr Haldane feared for the 37% of the population, whose households make less that £17k a year. Unemployment for many of them was a distinct possibility. There was also some positive news on the trade front from Secretary of State Liz Truss, who has agreed trade deals with Singapore and Vietnam. The former is a significant achievement, as Singapore is a massive entrepot for tariff free activity. In passing all ports across the world have been clogged up, thanks to the global economic recovery. In Europe, many people would have us believe it is BREXIT panic. That is not the case. Finally, the Bank of England are satisfied that our banks are sufficiently well capitalised with robust balance sheets, that permission has now been granted for them to start paying dividends in 2021.

Financial news was plentiful on the Street of Dreams. It was an amazing week for IPOS, with Airbnb’s debut seeing its shares rally by 112% on the first day of trading last Thursday, valuing the company at over $200 billion. This valuation looks very frothy. However, considering there was little holiday activity in 2020, AirBnB performed well, with its revenue only falling 18% in the last year. With the whole world supposedly open to visit in 2021, who knows? Door Dash, a deliver operation also made its debut last Wednesday, with shares making a 78% gain on the first day of trading. There have been $279 billion of flotations in the US this year, just short of the $298 billion record achieved in 2007. 

Disney also produced encouraging streaming numbers with 86 million subscribers signed up in the last year. They hope to sign up 230 million by the end of 2024. The cost of subscription has increased by $1 a month to $7.99. Netflix, you are very much in a competition! Bob Dylan, the 79-year-old iconic singer, who until the pandemic was still doing gigs, sold his 600 songs and musical material to Universal Music for $300 million. Uber Technologies served notice that it will not be developing its driverless car operation. It has cost Uber circa $4 billion.

Here in the UK much time and speculation were spent ‘huffing & puffing’ on the precarious future of Arcadia and Debenhams. Fraser’s Mike Ashley would like to ‘cherry-pick’ the assets which would be synergistic to his retail empire and will shortly let us know what he can do, which may not suit either of those two forlorn parties. Primark is said to be looking at the Topshop empire and it would not surprise me if NEXT did not try to prise away the odd on-line gem.

Thanks to bailouts from Germany’s government, totalling almost €5 billion, Tui Travel has survived, having posted a loss €3.2 billion, but the company is upbeat about the future with bookings looking encouraging. Ted Baker cut 953 jobs in the first half of the year as the pandemic took its toll on the business. CEO Rachel Osborne called the decision “extremely hard but necessary” having posted a discouraging trading statement. McCarthy and Stone, the builder of retirement homes agreed to be taken over by Lone Star, the private equity company for £647 million – a 46% premium on 2nd October closing share price. There have been fun and games at G4S. Firstly Garda World’s 245p bid was usurped by the US’S Allied Universal, who agreed to buy the security operation for £3.8 billion. However, Garda have reappeared on the scene, refusing to be dismissed from the battle. We await developments.

IKEA have announced that it will no longer circulate its catalogue as the change in its retail activity unfolds. Over the years IKEA’S catalogue circulation has reached 200 million people, third behind the Bible and the Koran! With the retail sector having returned £2 billion excess business rate relief to HMRC, pressure is being put on betting companies to do the same. Most of their shops have been closed. However, this has been a bonanza earning time for many, especially GVC and Flutter. We await developments.

Most people are very disappointed that BREXITEER Sir Jim Ratcliffe has decided to open his Grenadier factory in Moselle in France in a former Mercedes factory rather than in Bridgend, where 500 jobs could have been created. Maybe he will have been offered better subsidies by the French Government and by Mercedes. Business is business. However, I find it hard to believe that Honda’s Swindon factory could not have been the answer to the problem.

AMC Entertainment Holdings, the world's largest movie theatre operator and the owners of the Odeon cinema chain, has secured $100m (£76m) in emergency funds - but warned the money will only help it through another month. Odeon Cinemas said attendance has dropped 92% in the US and 86% internationally. 

Save the best until last! Astra Zeneca have agreed to pay $39 billion for Alexion Pharmaceuticals, leaders in the world of immunology. Alexion’s leading drug is Soliris, which treats rare red blood cells afflictions. Sources say that Pascal Soriot, Astra’s CEO, had considered buying Gilead, but decided against it. This cash share deal will leave Alexion with 15% of the joint operation. Let us hope the fruits of Astra’s and Oxford University’s labours on the vaccine come to fruition before too long.

UK companies posting interim results this week – Monday – Hollywood Bowl Group, Tuesday – Chemring, PurpleBricks, SSP, Wednesday – Dixons Carphone, Thursday – Revolution Bars, Friday - Carnival 

US Companies posting interim results this week – Wednesday – Lennar Corp, Thursday – Accenture, Rite Aid, FedEx, General Mills, Jabil, Friday – Carnival, Darden Restaurants, NIKE

Economic data to be posted this coming week – Monday – Japan Industrial Production, EU Industrial Production (Oct), Tuesday – UK Unemployment rate, UK Average earnings, US Import/Export Prices, US Empire State Manufacturing, US Manufacturing Output & Industrial Production, Wednesday – UK Inflation (Core, CPI, RPI), EU Markit PMI Composite, UK Markit PMI Composite, USA Mortgage Applications, US Retail Sales, US Markit PMI Composite, FOMC Decision, Thursday – EU Inflation, MPC Meeting, BoE QE Meeting, US Initial Jobless Claims, US Phili-FED Index, US Housing Starts, Friday – UK Gfk Consumer Confidence, UK Retail Sales, Germany ifo, UK CBI Industrial Trends

SOURCES – BBC, CNBC, Reuters, Daily Mail, FT, The Times, Sunday Times, Telegraph Group, Bloomberg, Yahoo Finance