Friday 24 April 2015

Interesting end to the week!

Interesting week for my portfolio with a number of mixed news items but enough positives serving to propel it to new all time highs.

Index @ 2333.34, +5.37% in the month to date, +11.63% YTD, +133.33% since 1 Jan 10
FTSE100 @ 7070.70, +4.39% in the month to date, +7.69% YTD, +30.63% since 1 Jan 10

On the downside:
- news that IG clients were unable to use the company's online trading platform for several hrs on Tuesday
- William Hill lost ground as profits took a hit from a bad weekly hit on football results in January, and a new regimen of taxes.
- Barratt Developments, BG Group, and Rolls-Royce all trading ex dividend.

On the seeming upside:
- At Rolls-Royce non-executive Warren East was announced as the next CEO inline to replace the current CEO John Rishton who announced plans to retire in July after just four years in charge.
- BAE announcing plans to consider the disposal of its US based manpower and services business
- Apple began shipment of its first Apple watches following a suggested 957,000 pre-orders on April 10, with Q2 earnings due to be reported after Monday's close
- Microsoft reported a 5%  increase in Q3 revenues ahead of analysts estimates.

Elsewhere:
- BG Group remains up after recent news of Royal Dutch Shell's intent to buy
- GE has retreated from recent highs resulting from news that it intends to offload its troubled finance arm
- at $1.52, the dollar has retreated from recent highs of $1.46 to the pound

And all this against the impending backdrop of negativity created by, oil prices, slowing Chinese growth, Greece's flirtation with debt default and the upcoming UK General Election bringing its own uncertainty around European membership, and regulatory and/or policy interference to various sectors of the markets such as energy, housebuilding, and banking amongst others.

Given the last time Labour entered Government resulted in the smash and grab of the pensions tax credit, windfall taxes, and regulations on insurance liquidity which possibly led to an extended stock market correction as such as Standard Life sold assets at the bottom of the market and bought gilts at the top of their market (liquidity constrained by a lack of new Govt issues). 
And despite its long term strategy being to wait on the recovery of its assets (pre fire sale), Standard Life also eventually found itself succumbing to privatisation as it sought to shore up its finances.

The manner of the Labour Government's departure also seems to have been forgotten along with the roles played by many of the current shadow cabinet, and it would seem a travesty to gift these fallen ministers another chance at furthering a political career/personal gain for the sake of mind games over austerity measures.
The current deliberation over the post election possibility that Lloyds could once again be fully privatised should serve as a further reminder of the last government's intent to mislead with its shotgun marriage of HBOS to Lloyds.

I'm digressing slightly but the point remains that despite these concerns the FTSE100 has finally broken new all time highs to break the 7000 mark which it has failed to do in both the run up to the tech bubble (Dec. 1999: 6930), and the run up to the credit crunch (Oct 2007: 6751).
Does this bode well for new highs to come, or a post election, or some other global event led crash?

Only time will tell.

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