“Forward, the Light Brigade!”

Was there a man dismay’d?

Not tho’ the soldier knew

Some one had blunder’d:

Theirs not to make reply,

Theirs not to reason why,

Theirs but to do and die:

Into the valley of Death

Rode the six hundred.


Cannon to right of them,

Cannon to left of them,

Cannon in front of them

Volley’d and thunder’d;

Storm’d at with shot and shell,

Boldly they rode and well,

Into the jaws of Death,

Into the mouth of Hell

Rode the six hundred.


Flash’d all their sabres bare,

Flash’d as they turn’d in air

Sabring the gunners there,

Charging an army, while

All the world wonder’d:

Plunged in the battery-smoke

Right thro’ the line they broke;

Cossack and Russian

Reel’d from the sabre-stroke

Shatter’d and sunder’d.

Then they rode back, but not

Not the six hundred.


Cannon to right of them,

Cannon to left of them,

Cannon behind them

Volley’d and thunder’d;

Storm’d at with shot and shell,

While horse and hero fell,

They that had fought so well

Came thro’ the jaws of Death,

Back from the mouth of Hell,

All that was left of them,

Left of six hundred.


When can their glory fade?

O the wild charge they made!

All the world wonder’d.

Honor the charge they made!

Honor the Light Brigade,

Noble six hundred!”

Alfred, Lord Tennyson – poet – 1809-1892


Considering that PM May was coming from a position of great weakness, with no working majority, I thought she acquitted herself very well with a decent honest and pragmatic speech.  Having taken an age to agree a policy with her fragmented Cabinet, I thought her attitude was conciliatory and fair. She is never going to please the hard-Brexiteers and the ‘Remainers’ so long as night follows day.  However, her main problem going forward, will be the EU. With Germany just able to form a coalition government, Italy likely to post a totally inconclusive result to the weekend’s election and rumblings in Greece, Poland and Hungary gathering momentum, the unelected bureaucrats from within the EU will be under orders to concede absolutely nothing in these negotiations. So, however reasonable Mrs May would like to be, I can see a ‘NO DEAL’ as a possible outcome. I sincerely hope not!  In closing I was very shocked that Messrs Major & Blair were not vehemently critical of Barnier’s disruptive comments regarding the UK’s constitution over Northern Ireland – Pretty disgraceful stuff, even though the French aristocrat tried to bluff his way out of his very undiplomatic comment by indicating it was just an option.


At the end of the year, most global indices were at record levels or close to. Global growth was estimated to rise by 3.9% as articulated by the IMF’s Christine Lagarde, who in the same breath was contemptuous of the UK’S decision to leave the EU and how it would damage it irrevocably. By the middle of January equities were on fire thanks in the main, thanks to Trump tax mania. By 26th January doubts were beginning to set in. Erudite economists were starting to mutter inflation and higher interest rates in the US and eventually elsewhere. Most indices started to look very frothy and over-valued, despite US and European earning season posting more than adequate results.


A healthy correction was inevitable and so it transpired, aided and abetted by violent volatility with algorithm traders, the markets’ ‘spivs and vagabonds’ giving the market some measurable and very effective ‘welly.’ Most markets eased by 7-8% by mid-February and in the month of February as a whole, the following indices eased -


US markets in February stopped the longest bull run in US of 10 months since 1958 - DOW -4.28%, S&P -3.89%, NASDAQ -1.87% - Europe in February 2018 FTSE -4%, DAX -5.7%, CAC -2.9% - GLOBAL INDICES DOWN by an average of 3.7% last month.







% gain/loss

FTSE 100
















S&P 500








Hang Seng








Shanghai Composite






Apart from the fact that FED Chairman Jay Powell in his testimony told Congress that the US economy was in robust health and that the Fed would continue to raise interest rates, good news was in limited supply. Hence the market’s response to Powell’s news was a little negative with some risk being taken off the table.


This coming week tells us that politics will attempt to be the market’s main ‘dramatis personae.’ Germany’s Merkel finally forms a coalition with the SDP. Italy’s election suggests an inconclusive populous result with the centre right parties (some anti-EU) likely to form a coalition with Matteo Salvini a possible PM.  President Trump’s threat to impose a 25% tariff on steel imports to the US became a reality last week - promised and delivered. It was met with anger and indignation. Not surprisingly shares in companies such as ArcelorMittal and ThyssenKrupp were affected negatively. China was for the time being not included in this act of trade warfare. The President, never short of a riposte, has threatened similar tariffs against EU car imports, if EU reacts adversely to steel tariff. PM May and other EU leaders have expressed their dismay. Trump has also met with resistance with the sale of guns with Walmart ceasing to sell certain weaponry as has Dick’s Sporting Goods.  American Outdoor Brands also said that sales of guns had dropped by 32% in the last year. China’s President Xi Jinping looks as though he will have his tenure extended.


The Street of Dreams was not a happy place to be last week. The week before last Walmart eased by 10% in a day after weak results with $25 billion wiped off it share value. Though JC Penney, Foot Locker and Abercrombie & Fitch are minnows in comparison, their results did not pass muster and investors vented their spleens on their respective share prices, taking them down by close to double digit percentages on the week. Nordstrom and Macy’s were the exceptions. Though their results were decent, they were hardly stellar. Is this on-line ailments?


There were deals in the making with Qualcomm and Broadcom on song to climb in to bed with each other, as are General Mills and Blue Buffalo due to do the same in an $8 billion deal. And, of course the ‘daddy of them all’ - Comcast usurping 21st Century and Walt Disney to buy Sky in a $31 billion deal. Whether Walt Disney cares to indulge in a bidding war remains to be seen - many doubt it. Certainly, UK regulators are likely to be more comfortable with a deal that precludes any Murdoch interest. It should not be forgotten that SKY and News Corp have been brilliant employers in the country, despite hacking misdemeanours. The NASDAQ lost less in value than other US indices last week, but on Friday, the likes of Apple, Alphabet, Facebook and Netflix all shed over 1% during the session.


Back here in Old Blighty, there was good news on the industrial front with factory output bouncing significantly in January. There was also a massive slew of earnings to consider and ruminate over. The market, after such an incredible surge in the last decade has become very unforgiving towards companies that fall short of profit expectations. Last week household names fell sharply in value when failing to pass muster with analysts and investors -Mothercare -15.4% on Friday, WPP -10% on Thursday, Carpetright -23%, ITV -10.4%, Moneysupermarket -8% and Capita continues its fall from grace -6.4%.


Conversely there was also good news for shareholders on deals, funding and improved profits and outlook - Sky +23.9%, Persimmon +8%, Cobham +12% on Thursday and Provident Financial +76%, admittedly from a very low base thanks to only £300million rights issue being required rather than £500 million. PF’S shares stood at £29 and change in June 2017. Toys R Us and Maplin went into administration with the likelihood that 5500 jobs will be lost. Investors will be looking over their shoulders with concern at House of Fraser, Debenhams, Kingfisher, N Brown and others. Can they adjust quickly enough to on-line requirements? Personally speaking, I fear for the ‘High Street’ in many places. Rent and business rates are slowly throttling retail on our high streets.


After 18 years the Sunday Times tells us that Equitable Life may hand out millions to pensioners. We hear that Interserve may require cash to bolster its balance sheet and finally it is rumoured that Rolls Royce’s CEO Warren East is preparing fresh cuts to bolster the profitability of this engineering giant.


UK companies posting results this week – Monday – Ultra Electronics, Tuesday – Intertek, IWG, Headlam, Just Eat, Aggreko, Rotork, Bodycote, SDL, Wednesday – Rolls Royce, Paddy Power Betfair, Page Group, eSure, CLS Holdings, DS Smith, Legal & General, Restaurant Group, Thursday – Aviva, Premier Oil, Countrywide, Domino Pizza, Spirent, International Game Technology, John Laing, G4S, Friday – Inmarsat. SIG, Eurocell


US companies posting results this week – Monday – The Street, Tuesday – Target, Ciena, Urban Outfitters, Ross Stores, Autodesk, H&R Block, Medifast, Wednesday – Brown Forman, Abercrombie & Fitch, Costco, Thursday – L-Brands, Stage Stores, Vail Resorts, Christopher & Banks, Friday – Revlon, Big Lots


Economic data posted this week – Monday UK new car registrations and PMI Services, Tuesday – BRC Sales, US Factory Orders, Durable Goods, Non-Farm Productivity, Wednesday – Halifax House Prices, US ADP Employment Index, Friday – UK Trade Balance, UK Industrial production, UK NIESR GDP estimate, US Non-Farm Payrolls (+190k) and unemployment data (4.1%).


David Buik

Core Spreads

Core Spreads is financial trading as it should be. No noise – just tight spreads on thousands of markets.

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