Market comment 01

The market cannot rally. This mornings data has shown a raft of UK companies reporting well, but yet prices are subdued or down.

Companies reporting

A broad range of companies reported today from different sectors (banking to mining) and different phases (value to growth). All have been suppressed.


Banking, has seen, BARC (UK value play @ ~50% of book) report a q3 profit and generally decent numbers. Also in the same sector, MTRO (UK growth at 65x earnings) double its EPS. Barclays is +0.5% on the open and Metro is -10%. Overseas, the same story holds true for DBK (Deutsche bank), which posted acceptable quarterly numbers (net profit 226 mill) and sees its share price open 4% lower.


The mining sector is no different. Having posted on ANTO (Antofagasta) whose copper production was +15% QoQ, the share price opens unchanged. This is a mid-range stock which trades at 12x. The same is true for FRES (Fresnillo) which posts acceptable gold & silver production and opens down 1.5%.


The same story holds true from UK home builders. Having now seen several reporting well (BDEV, RDW are good examples) and also the building space (TPK) it is observed that good numbers are an opportunity for sellers to exit.


Whilst this comment is based on a small sample size and temporally small, this is a continued theme. The market is in a risk off mode. Simple observation has the FTSE 100 at 13.25 with a 4.2% div yield, which indicates that the market demands more return for the perceived risks.

FTSE 100

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