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Friday Email: 24 June 2016

Every Friday morning our lead analyst Mark Riding sends out his weekly run-down and upcoming events in the investor calendar, like this one:

I must say that I am shocked. The result is upon us and the British public has voted to leave the European Union with the inevitable plunge in the markets. It is difficult to say how far they will fall and for how long. The uncertainty regarding the future will last for quite a while. Will Cameron resign? Will Northern Ireland join the south? Will Scotland have another referendum? Will there be a general election? What happens now in the rest of Europe?

Photo-me produced excellent numbers on Tuesday that were received by the market very badly. They doubled their commitment on the dividend from a 10% increase to a 20% increase in each of the next two financial years. They hit a 12 month low of 126p, but have sinced bounced back to 137p as investors recognised the strength of the yield on offer over the next few years. Add to that the expected growth in the laundry business and the strong balance sheet with over £50 million and the initial reaction seemed well overdone. Following the Brexit vote, they, along with quite a few others will be big beneficiaries of currency translation on the face of it. However, they will fall heavily along with most stocks when trading starts later on today.

I am up early as I have to drive my son to the Goodward festival of speed and although the referendum result is not yet confirmed from 5.08 am to 5.37 am the FTSE 100 future has fallen from minus 450 to minus 550. The results that still have to come in are all from England where some of the results are showing that over 60% want to leave the EU, so as I prepare to set off, it is clear that we will leave the EU. Looking at the voting, it is quite amazing how they are spread across the country. In some areas really large percentages wanted to remain and in others really large percentages wanted to leave. London has voted overwhelmingly for remain. I am glad I will be driving rather than watching the markets this morning! It's 6.01, I am signing off. The FTSE 100 is down 564, the pound is at 1.34 to the dollar and crude oil is down 3 dollars a barrel.

 

This email was originally sent on Friday 24 June 2016

The Friday email is delivered to over 20,000 subscriber’s every week, and remains a widely read run-down of recent events and what investors can expect in the week ahead written by our chief analyst Mark Riding.

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