WEEKLY FAYRE – Monday, 7th June 2021

June 7, 2021


“Out in the dark over the snow

The fallow fawns invisible go

With the fallow doe;

And the winds blow

Fast as the stars are slow.


Stealthily the dark haunts round

And, when the lamp goes, without sound

At a swifter bound

Than the swiftest hound,

Arrives, and all else is drowned;


And I and star and wind and deer,

Are in the dark together,---near,

Yet far,---and fear

Drums on my ear

In that sage company drear.


How weak and little is the light,

All the universe of sight,

Love and delight,

Before the might,

If you love it not, of night.”


Edward Thomas – poet & soldier – 1878-1919



Many were delighted for the very popular Adam Kirby, that he won the Derby last Saturday, with a fair bit in hand on the 16-1 shot Godolphin-owned Adayar, a spare ride he picked up from Charlie Appleby. Kirby had been jocked-off Ed Dunlop’s ‘John Leeper’ a few days before, in favour of Frankie Dettori.  In hindsight, it looked to be a very average Derby, with Aiden O’Brien’s ‘hot-pot’ ‘Bolshoi Ballet’ (6/4 fav) beaten out of sight.


The same could not be said of the ‘Oaks’, which was run on Friday. Frankie Dettori, riding Aiden O’Brien’s ‘Snowfall’, out of a ‘Galileo’ mare ‘Intikhab’, dotted up by sixteen lengths, with her head in her chest, pulling a train in rain-softened ground. This looked like an above average ‘Classic’ for fillies over twelve furlongs. On the right ground, she looks like a super star in the making.


How did Roger Federer reach the last 16 of the French Open - a Grand Slam appearance for a record-extending 68th time after defeating Germany's world No 59 Dominik Koepfer, 7-6 (7-5) 6-7 (3-7) 7-6 (7-4) 7-5?  Totally amazing. Federer looked cooked after the 3rd set. His tenacity, his will to win and all-round class at the age of 39 finally took him over the line at 12.43am! Having played little tennis due to knee surgery, Federer has withdrawn from the tournament after such a gruelling match, as he continues to build up his strength for Wimbledon and the rest of the season.




28th  May 2021

4th June 2021

% Loss/Gain

















S&P 500





















*Denotes 31st May 2021.


Overall, the global economic data posted last week was positive. The OECD upped its prognosis for global GDP in 2021 to 5.8%, with the UK coming out top of the poll with 7.2%, ahead of the US at 6.4%, with the caveat that Brexit could stunt UK growth in the years to come. I think the UK will make that, there being plenty of time to remedy Brexit threat. Construction in the UK is booming as it is in many parts of the Western economies. Huge demand for construction raw materials and global trade disruption have sent costs rising at their fastest pace for 24 years as companies race to secure the goods they need to build, according to the data company IHS Markit.


As for the services sector, the IHS Markit/CIPS Purchasing Managers’ Index (PMI) for the UK rose to 62.9 in May from 61.0 in April, taking it to its highest since May 1997 and above an initial estimate of 61.8 on an index where a reading above 50 points to growth. Consumer spending bounced by 8% in May. Some 60% of business turnover increased, or at worst in places, trod water. All that remains uncertain is the immediate destiny for travel and holidays. The government’s inability to provide positive guidance could rock the economy back on its heels temporarily, despite qualified reassurances that the economy is expected to ‘open up’ on 21st June 2021. The ‘doubt syndrome’ is conceivably being exacerbated by the scientific and medical “Doubting Thomases”, who persist consistently in massing their troops, to a point of irritation! Last Thursday, in response to the prevarication on travel arrangements, shares in IAG, Tui and easyJet all dipped by about 5%. The Halifax House Price Index illustrated a rise of 10.9% in the year to May 2021. Chancellor Sunak chaired a G7 Finance meeting, where agreement was reached, in principle, on corporate taxation. In exchange for a 15% corporate tax rate threshold being agreed by G7 members, tech companies would pay tax on business conducted in the country of origin. It is a great start, but until all maverick countries like Ireland come into line, it will be hard for the world to hold ranks.


The most important piece of monthly US economic data, Nonfarm Payrolls rose by 559,000 in May. This reading followed April's print of 278,000 (revised from 266,000) and came in worse than the market expectation of 650,000. Further details of the report showed that the Unemployment Rate declined to 5.8% from 6.1%. As for Thursday’s Initial Jobless Claims, there was further improvement, as those claiming benefits fell to 385,000 last week, the first time this figure has fallen below 400,000 since March 2020.


Despite all this encouraging economic news, equities suffered from a significant dose of inertia last week. The rally since the 23rdMarch 2020 has been all but perpendicular. This will not have escaped market aficionados’ attention.  Investors continued to worry themselves over inflated valuations. Vaccination rollouts are going well, but this virus will only be contained when the whole world has been jabbed and that goal is some way off. It will also be necessary for the supply chain to be ironed out, to prevent rampant inflation becoming an unwanted guest. Hence, a degree of volatility within a narrow range prevailed, with most global bourses making some modest gains with Asia remaining a smidgen under the Plimsoll line.


On the Street of Dreams, the earnings season was drawing to a satisfactory, if not spectacular, close. Even though there has been a measurable return to work, Zoom posted a 191% increase in revenue for the last quarter, though there was a qualified outlook for the next few months, which triggered a 4% fall in its share price on Monday. Like other tech giants, Amazon may experience a mild setback at the hands of global taxation threats, but it continues to increase and multiply with the confirmation of its acquisition of MGM studios for $8.5 billion, and its expansion into food. It is expected to become the UK’s largest retailer by 2023, usurping Tesco. Tesla’s Elon Musk served notice that it will be entering the restaurant business to complement its car charging service.


Here in Old Blighty, corporate earnings were not that high profile last week, though stellar efforts were posted by B&M and Bloomsbury Publishing. B&M hired 7,000 employees last year and like-for-like sales increased by 24%. Sales increased by £1 billion to £4.8 billion, despite significant lack of cooperation from the EU/UK on Irish issues, which continues to frustrate and displease its founders, the Arora brothers. Bloomsbury posted increased revenues from £162.8 million to £185.1 million, thanks to the pandemic guiding people back to reading books, especially the Harry Potter brand (+7%) and cookbooks (Sarah J Maas books up 129%). Shares rose 11% on the news. BT wound up its 20-year relationship with Carphone Warehouse and severing this connection cost BT £149 million in compensation. Dipping sales for EE triggered the divorce. EE subscribers through CW had fallen from 50% to 15%. Tesco lost its ECJ supermarket shop floor pay dispute, which may cost the UK’s largest supermarket £2.5 billion in settlement. There is little doubt that CEO Ken Murphy and his board will appeal this judgement. BA will be handing over the management of its £21 billion pension fund, which encompasses 85,000 members to Blackrock, the US fund manager.


Last week was a frenetic one for M&A activity. Ali Parsa, an Iranian refugee, who has run his healthcare operation in London since 2014, signed a $3 billion deal to float his company – Babylon - on the NASDAQ – a pity he could not have chosen London. Etsy, a second-hand fashion app served notice to buy Depop – the resale home for Gen-Z shoppers for $1.6 billion. Ferrero, the Italian confectioner bought Burton Foods, which makes Wagon Wheels, Jammie Dodgers, Maryland Cookies and Viscounts for £360 million. Ferrero had previously bought Thornton’s chocolates for £112 million. Russia’s richest Oligarch, Alexey Mordashov is hoping to bring his Nordgold operation to the market on the LSE for a purported £3.5 billion valuation. However, its listing may be challenged on security grounds.  Not long ago, he had rejected a £920 million valuation, but the price of gold has risen by 60% in the last three years. Mordashov had previously brought Severstal, the mining and steel operation, for its floatation in London in 2006.


Astra Zeneca is continuing to head off trouble from the EU, which is proving to be an irritation in agreeing the Anglo-Swedish drug conglomerate’s $30 billion acquisition of Alexion, which will become the company’s fulcrum for rare diseases. Despite Astra’s outstanding commitment to the Covid-19 vaccination (at cost), which many EU countries have from time to time rejected, it is thought that Pascal Soriot, its CEO will be successful in turning the company in to a global drug powerhouse. Its share price has dipped from £92 last July to £80.5 on Friday. When this regulation has been agreed, let’s hope it is reflected in the share price. Investors will recall that Astra rejected a £55 a share takeover by Pfizer. As if that battle were not enough to keep Soriot on his toes, Astra is now locked in legal argument with GSK over an oncology drug, Zejula. The ownership and patent for this ovarian cancer treatment is being challenged by Astra, which helped develop the drug but agreed to licence it to GSK.


UK companies posting interim results this week –  Monday – Paragon, Sirius, Oxford Industries, Tuesday – Card Factory, B.P Marsh, Ferguson, Wednesday – Auto Trader, Mitie, SSP, Thursday – CMC Markets, Halma, Naked Wines, Ted Baker


US companies posting interim results this week – Monday – Vail Resorts, Tuesday – Casey’s General Stores, Chico’s FAS, Wednesday – Brown Forman


Economic data to be posted this coming week – Monday – Halifax House Price Index, Tuesday – UK Retail Sales, Germany ZEW, EU GDP, Wednesday – US MBA Mortgage Applications, US Wholesale Inventories, Thursday – RICS Housing Market Survey, ECB Meeting, US Initial Jobless Claims, Friday – UK GDP, UK Balance of Trade, UK Manufacturing Output, Industrial Production, & Services, US Univ of Michigan Consumer Confidence