Morning Brief – Wednesday 13th

Alfred Lord Tennyson: The Charge of the Light Brigade

 

….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,

 

Tradition has it that according to market pundits and in particular the richest Rothschild of them all, Nathan Rothschild that one should “buy markets on the sound of cannons and sell them on the sound of trumpets.” If you are in any doubt, it takes a lot of courage to do that, which is why there are very few Nathan Rothschilds in the world of finance and plenty of Harry Hindsights!

 

One of the surprising things is how resilient the French stock market has been in the face of Les Gilets Jaunes. At the end of October 2018 the CAC 40 stood at 4989 and at the beginning of this week it was at….4999! So while the News editors and international market participants have grown bored and moved on, let’s take a quick look at what is happening still in La Belle France: Toulouse, Marseilles, Lyon and Rouen in addition to Paris have all witnessed demonstrations and violence requiring gendarmes, riot police and tear gas. Still it helps address France’s unemployment challenges! The stock market however sails blithely on.

 

Italian Deputy Prime Minister Luigi di Maio travelled to France and encouraged the leaders of Les Gilets Jaunes. So how did le petit Napoleon, Emanuel Macron react to this outrageous support from Italy? Yes he recalled the French ambassador to Rome- return to France toute suite! That certainly showed the Italians..and Les Gilets Jaunes!!

 

How do you make a Maltese Cross?  The answer to that old joke is: By sticking your fingers in his eyes. Yesterday the Maltese Finance Minister Edward Scicluna somewhat raised the stakes by saying that the UK leaving Europe with No Deal would be akin to an atomic bomb! For who? For Malta?!

 

And more on that: Governor Carney’s speech referred to Brexit being an acid test for the future of global trade and said again that a No Deal exit would be a shock for the UK economy. As expected Prime Minister Theresa May told MPs to hold their nerves as she manoeuvers MPs to a vote probably but not definitely(!) at the end of this month which will give them a stark choice: her deal or no deal. 

 

GBP was unchanged against USD and EUR. Oil firmed by a dollar with WTI at $53.50. Gold remains at just over $1306. FTSE unchanged at 7133.

 

So in conclusion while the Prime Minister holds her nerve, it remains to be seen whether MPs heed her instruction to do the same.

 

….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,

 

 

 

Discussion and Analysis by Humphrey Percy, Chairman and Founder

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