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Source: BigCharts.com So why is gold so weak? Well the first answer that comes back is because the US dollar is strong. There’s no denying that with the DXY having a pop at that nice round 100 level overnight. And then it is also fair to say that the above gold chart looks somewhat different in euros or Russian rubles or Brazilian reals. Gold is like that though. ‘Barbarous relic’ to some, the ultimate last resort to others. It just depends on your point of view and from where you are saying it from. What interests me most about gold is that it has persisted in some role in the broad global monetary system for so long without paying a rate of interest. It might now be a fraction of central bank reserves but there is a longevity there which attracts me. In a world of monetary base expansion via policies that would have been dubbed as truly unorthodox a decade or two back a mixer asset like gold still works for me in a broader portfolio. So buy some bars to stick under the floorboards or the bank vault? I guess that might be part of a really diversified strategy but for me the best way to access the gold story remains companies with that holy trinity of rising production, low cost and focused management. In the larger cap gold space over the last few years that has always pushed me towards one name above all others: Randgold Resources, which usefully has the ticker GOLD. When gold is in the headlines for all those worrisome reasons I find heading the other way and buying some GOLD stock has been a wise move especially as management are delivering in some of the more operationally challenging global markets in west and central African.

NOT ALL GLOOM FOR SCOTLAND'S OIL INDUSTRY North Sea-focussed oil and gas companies may be in for a slowdown, but they will continue to create jobs over the next year, according to a survey by the Bank of Scotland. The country's dominant oil and gas industry is expected to add around 8,000 jobs over the next two years and turn its attentions to onshore shale gas

A tentative deal has been made between the United Steelworkers Union and Shell, the company representing refinery operators, to end the biggest US refinery strike in 35 years, writes The Wall Street Journal. Thousands of union workers have staged a walkout over salaries, safety and other issues over the last six weeks.

Glasxosmithkline has sold half its stake in former South African associate Aspen Pharmacare for £0.57bn. Having sold 28.2m shares, at a price of 372 rand per share, GSK now holds a 6.2% stake in Aspen, South Africa's largest drug company.

JD Wetherspoon served up a slightly short measure of first-half profits as the pubs group saw cost pressures outweigh a rise in revenues. For the 26 weeks ended 25 January sales rose 9% to £744.4m, or up 4.5% on a like-for-like basis.

Dropping euro to fuel property buy-up in 2015: Investment in Europe’s property market is expected to jump by as much as 10% this year thanks to low interest rates and the expected ongoing euro devaluation

Argos suffers a post-festive depression: Argos had little cause for post-festive cheer after sales at the catalogue retailer slumped in the first eight weeks of the new year, it announced.

Osborne mulls further change to annuity rules: Chancellor George Osborne is considering including a further shake-up of pensions rules in his crucial pre-election Budget next week, to allow pensioners to sell their existing annuities for cash.

Aberdeen-based Eland Oil & Gas to increase investment in Nigeria: Eland Oil & Gas has said it still makes commercial sense to invest in increasing production in Nigeria in spite of the plunge in crude prices.

Shares in Edinburgh-based Cairn Energy plunge after £1 billion Indian tax demand: Shares in Cairn Energy have plunged more than 20% after the market reacted to news the company has been landed with a $1.6 billion (£1 billion) tax demand by the Indian authorities.

Luxury bag-maker Mulberry names Thierry Andretta as new Boss to head its recovery: Luxury bag-maker Mulberry has finally landed a new Boss, naming fashion veteran Thierry Andretta as its new Chief Executive to head its recovery.

Multiplex Owner Cineworld doubles annual profits on the back of blockbuster films: Multiplex Owner Cineworld has doubled annual profits on the back of blockbuster films including The Lego Movie, Inbetweeners 2 and Dawn of the Planet of the Apes, which together took £100.4 million in 12 months.

National Express first transport firm to pledge living wage for all U.K. workers: National Express is to pay the living wage to all its workers in the U.K., the first transport firm to pledge to do so.

Sell N Brown on second profit warning: N Brown warned that profits will fall short of expectations in the year ahead. The company sells everything from homeware and shoes to clothing in larger sizes by extending credit to its customers, who then have up to 28 days to clear the balance on their account each month. N Brown sells items through its Jacamo, Simply Be and JD Williams’s brands. Questor believes it is safe to assume this credit business makes up a much larger part of group profits every year because sending out account balances and collecting cash has much lower costs than selling goods. The reason for the rapid slowdown in sales and profit growth at N Brown is because the company is trying to reduce the risk from the credit extended to customers. Full year pretax profits are now expected to be about £85 million, down from the £103 million expected as recently as October last year. N Brown shares have collapsed during the past year from 599p on March 3 to 339p. However, the stock is trading on 17 times earnings, falling to 16 times next year, and, offering a forecast dividend yield of 3.5%, still looks expensive given the lack of guidance on a return to profit growth. We said it was “prudent to take some profits” (Sell, 465p, May 3) and we reiterated the sell advice in December at 350.2p. The shares have bounced 13% higher since then, but with no signs of a concrete return to sales and profit growth, we retain that advice. N Brown at 338.9p -69.7p. Questor Says “Sell”.

Avoid Foxtons as London prices slow: House prices in the capital are cooling rapidly and that means you should steer clear of shares in London-focused estate agent Foxtons. Foxtons is managing to offset the downturn in property sales with lettings, with revenues in this business up 7.7% in the last three months of 2014. The lettings business contributes about half of total group revenues and 40% of earnings. Foxtons is a classic example of a company that came to the market at a well-timed peak. The shares were priced at 230p in September 2013, the top of the range of expected prices, and trading on about 19 times earnings. The shares jumped more than 14% on the first day’s trading and peaked at 398.8p in February last year, leaving them trading at about 27 times forecast earnings. We recommended investors avoid this overpriced float at 230p on September 21 and the shares have subsequently fallen to 196.25p. The leaves the shares, trading on 16 times forecast earnings, looking overvalued, given that profits are only expected to grow by 8% this year. Foxtons at 193.5p-5p.Questor Says “Avoid”.

Serco still has a mountain to climb: Outsourcing giant Serco has been plagued by a series of huge disasters that has conspired to wipe almost £3.5 billion off the value of the company, and seen the shares tumble by more than 70% during the past 18 months. The best example of how it all went so wrong is Serco’s contract to maintain the Australian Navy’s fleet of patrol vessels. The boats entered service in 2007 and all was going well until there was a large increase in the number of illegal immigrants attempting to reach Australia’s shores in 2009. Suddenly, the patrol boats were pushed into service around the clock, and in harsh open seas that stressed them to their limits of their design. So, while Serco may have “confessed our sins” as Chief Executive Rupert Soames put it as he unveiled the company’s annual results, there is very little it can do to prevent it happening again. Serco took £745 million in charges for across all its contracts last year. Serco is now seeking to plug the hole on its balance sheet and stay afloat through a deeply discounted one-for-one rights issue at 101p, or a 51% discount to the previous day’s close and a 34% discount to the theoretical ex-rights price of 154p. The outlook is made even more uncertain by a shrinking order book. Serco said the work in hand fell from £13.6 billion to £12.6 billion at the end of December. Shares in Serco are trading on 23 times forecast earnings, making them overvalued for a company where revenue and profits will fall for the next two years. The shares pay no dividend and debts will continue to rise after the rights issue as cash goes out of the door on loss-making contracts. Serco at 183.70p-22.70. Questor Says “Avoid”.

ASOS shares soar on sales recovery: Investors rushed to buy shares in Asos on signs of a recovery in sales during the crucial Christmas trading period. Asos reported retail sales up by 19% during the three months to the end of February, which was a rapid acceleration on the 8% revenue increase in previous quarter. The increase in sales during the crucial festive period was taken as proof of a solid turnaround. However, Asos is having to cut prices to shift stock as the retail gross margin declined by 3.2% during the three months to the end of February, when compared to the corresponding quarter a year earlier. So, while sales may be increasing, profits could still suffer. The missing piece of the puzzle is how much advertising and marketing is also being used to drive these sales. And, much like the dotcom boom in the early 2000s, investors are buying shares purely on revenue growth and the hope of profits. Management reassured the market they are on target to hit expectations for pretax profits of £45 million, giving earnings per share of 41.5p, on revenue of £1.15 billion. Questor is less confident. Shares in Asos are now trading on 96 times forecast earnings for a company with falling profits, no dividend and a net asset value of about 2.6p per share. Asos at £37.02-423p. Questor Says “Sell”.

Banco de Sabadell / TSB: homage from Catalonia: Nobody expects the Spanish acquisition. Banco Sabadell’s tilt at the TSB came as such a shock that the U.K. lender’s shares jumped 23% on Thursday. Talks are at an early stage, but Sabadell is prepared to offer 340p per share, a small premium to TSB’s book value. A sale at that price would be a tidy return for anyone who bought at last June’s 260p IPO price. Compare that 31% jump to the 3% rise in the value of Lloyds (from which TSB was spun out) in the same period, and TSB shareholders should welcome the Spaniards with open arms. Lloyds, which still owns half of TSB, was quick to indicate its approval. The benefits for Sabadell investors are less obvious. They could have bought TSB shares for 264p on Wednesday. Their bank is offering a 29% premium. Cost savings usually justify a premium, but here they are not obvious. Sabadell is a diverse lender based in Spain. TSB is a retail-focused lender in the U.K. The Spanish bank may find savings by moving TSB on to its IT system (TSB pays Lloyds for its IT at the moment). It would also receive a payment from Lloyds to help with IT integration. And Sabadell is an experienced acquirer — it has made four in the past couple of years. But it is not clear that in this case IT alone can justify the premium. Still, it will be costly for Sabadell shareholders. Macquarie estimates that adding TSB would depress Sabadell’s capital ratio by150 basis points, and that closing the gap would require a €1.1 billion-€1.2 billion equity issue.

Serco: becalmed: Rupert Soames, the new Serco Chief Executive, aims to shore up an unwieldy global outsourcing business. He promises to focus on the most profitable bits while righting the balance sheet. On Thursday, the company announced a £555 million cash call, well telegraphed beforehand, alongside full year numbers. The shares fell 12% all the same, on top of the 55% they have lost in the past year. Post rights, the share count will double, lifting Serco’s forward price/earnings multiple to more than 30 times. The market, in other words, anticipates an earnings surge. A return to the 10-year average multiple of 17 times would require earnings to double. Mr Soames says that with pretax margins depressed to two%, returning to an industry standard of five% would achieve just that. This helps, but the company is still set to burn about £200 million in cash this year. While £80 million of the equity raised could offset part of that, the rest must come from cutting overheads — corporate costs exceed £50 million — and putting in fully centralised buying systems. Too much of Serco generates a low margin from steady-as-you-go business. That can be improved

IAG and Dublin close to agreement on Aer Lingus takeover: International Airlines Group and the Irish government are trying to hammer out a compromise over the fate of Aer Lingus’s valuable take-off and landing slots at Heathrow airport — the biggest barrier to IAG’s planned takeover of the Irish carrier.