THE MONEY MARKET

Ashburton Guardian, Volume XLV, Issue 10350, 14 March 1925, Page 6

THE MONEY MARKET

WOOL BELOW 1924 PRICES

THE LONDON MARCH SALES.

THE WEEK ON "CHANGE

(Written for the "Guardian.")

(By " Investor.")

The wool sales continue to make rather depressing reading. Both in Timaru and in London, at the latest sales, values have declined well below the level ruling twelve months ago for all but the coarsest wools. The bright ray in the situation so far as the broad interests of the Dominion are concerned is that erossbreds are maintaining their value so well. Demand undoubtedly is being deflected from the finer to the coarser wools, and that eventually may not bo a bad thing for New Zealand, where the dual-purpose sheep is held in such esteem. The trend of crossbred values is indicated by the following little comparison of the London March sales of 1924 and 1925 respectively:

In the light of those figures, and remembering the very large proportion of crossbred Wool in the New Zealand clip, the outlook does not appear so black as it otherwise might. But the decline in wool is going to considerably affect our export values, and omphasises the necessity for guarding against over-importations this year. Tax-Free Stock Sinks Lower. Tax-free Government Stock .touched a new low lovel this week, a parcel of Inscribed 4f per cent, selling at £96 ss. There have subsequently been sales of both Bonds and Inscribed at last week's price of £96 10s. Five ner cent. Inscribed Stock, which last sold at £97 12s 6d after sales earlier in the year at as low as £96 17s 6d, had a sale this week of £97 10s. The position of 51 per cent, stock is unchanged. A parcel of bonds changed hands this week at £lOl.

Traffic in Rank Shares In the banking group principal interest this week has centred in Australasia, which are now cum 6s 6d. There have been sales in all centres since the declaration of the dividend, which is unchanged, at £l4 2s 6d, sellers having reduced their price from £l4 5s to £l4 3s in the meantime. National of New Zealand have had some traffic at the unchanged price of £6 15s 6d, and New Solith Wales, after a sale at £42, declined to business at £4l 10s and then at £4l ss. The last previous sale since the shares have been ex div. was at £4l 7s 6d. There seems no reason for the subsequent fluctuations, which, after all, only amount to 4|d in the £, save the exigencies of supply and demand. New Zealand rights are about a penny down, the sales range being 31s 4d to 31s sd, and the shares ex rights are unchanged with sales at 52s 6d to 52s Bd. Union Bank, which had traffic last week-end at £l4, opened this week with sales at £l3 19s. advancing bv steps of 6d to £l4 0s 6d. These shares were selling at £l4 3s ex div. a month ago. Buyers of Commercial of Sydney have advanced their offer in the 'last month from £22 15s to £23 10s. There are no sellers at time of writing.

Quiet Market For insurance Shares.

Insurance shares have not had much attention this week. New Zealand, which sold last week at 30s 9d to 318, have had business this week at 30s lOd and 30s Hd. South British, which were at 47s 6d a month ago, have declined another sixpence this week to sales at 465. The amalgamation rumour has not been active lately. According to the Dunedin List, Standard Insurance have declared a dividend of Is for the half-year ended December 31 or at the rate of 13 1-3 per cent, per annum. Last year's comnleto dividend was at the rate of 22* per cent., of which 9d was paid at interim, being 15 per cent, per annum on the then paid-up value of the shares, 10s. A capitalisation of reserves has since raised the amount paid up to 15s, but reserves are still nearly three times the amount of paid capital. I have not seen any official intimation of Standard's distribution, but this company does not usually publish its interim dividends.

The National Mortgage Dividend Business has been quiet in the loan and agency group. A sale of Goldsbrough Mort at 47s 6d marks a further drop of a shilling, emphasising the fact that wool is falling. National Mortgage, now cum div. in the ordinary course of events, have sold this week at 82s, the first reported sale since October last, when the shares changed hands at 765. The Dunedin Stock Exchange Li6t announces a dividend of Is 6d and a bonus of Is 6d on ordinary shares, the same as last years final, making this year's distribution the same as last—4s 6d per £2 share, or Hi per cent. In this case again there is no official notification, and in this case the absence of publication is notable. For long years a brief summary of the annual report of both Loan and Mercantile and National Mortgage has been cabled from London to the New Zealand Press. This year Loan and Mercantile was not sent, and it was not until the item had 'been copied here from the Svdney newspapers that the New Zealand management made an announcement. National Mortgage, apparently, is also suffering from an .oversight on the part of the London newsgatherers who serve the Dominion—or has reasons for delaying publication. In the shipping group the only transaction recorded is a sale of Huddart Parker at 455, showing a further drop of 6d. It looks as if the P. and O. purchase had faded out of the picture. Meat preserving shares are not sought after. Refrigerating have lir . business at par 'and appear likely ti sink below it, when investors of a speculative trend of mind will doubtless seize the opportunity. M,Z. Breweries Still Rising.

There has been no further reported

traffic in Christchurch brewery shares, but quotations are stable. New Zealand Breweries, Ltd., have jumped another shilling to sales at 395, and rumour has it that this buying is by people who ought to know what is brewing. A month ago holders were willing to quit Christchurch Gas at £7 13s 6d, but the price has since stiffened to £7 15s. at which figure there was a sale reported this week Wilson's Cement, which a fortnight ago sold at from 30s 9d to 31s 9d, has had business this week at from 31s to 31s 6d. The Mining Share Market.

In the mining group, Mi. Lyell are in traffic again after being off the sales list for a month, business this week being at from 22s to 22s Id, as against a range of 22s 8d to 22s 9d a month ao-o "Waihi, which have been hovering between 25s and 25s 6d for some weeks past had sales this week at from 24s 10d to 25s 3d. Junction bad their first reported sale this year, the price being a shilling. Last sales were m September, when 2s 5d was paid. Kawarau, after reaching 26s 9d a month ago, had fallen by the end or last week to 22s Cd. This week there is a reviving tendency, the course of sales beino-: 235, 23s 3d, 23s 6d.

London Bank Share Quotations. Bank share and other quotations cabled from London last Tuesday offer the following comparison with those cabled a fortnight previously.—

The latest quotations' compare as follow with those current in New Zealand at about the same date:—

The Bank of Australasia. Holders of Bank of Australasia, were disappointed when the cabled announcement of the annual distribution contained no reference to a new share issue, and there have been a good many sellers lately at £l4 2s 6d, cum 6s 6d, equal to £l3 16s ex. The buyers probably recall the experience of 1919, when the bank made a new share issue at a substantial premium and then when holders had had ample time to express their disgust, and sell thenshares if they wanted to, £1,000,000 of reserves was cut up among shareholders in >a. bonus share issue. History sometimes repeats itself, though generally with some disconcerting variations. Details of the latest distribution compare with those of the previous

Reserves, which now stand at £3,853,433. are very nearly as large as paid capital, besides which there are undisclosed reserves created by heavy writing down of properties that i.re steadily increasing in value.

March, 1924. March, 1925 d. d. d. d. Greasv crossbreds — 48-50 ... 22 to 29 23 to 26 46-48 ... 20 to 25 22 to 25 44-46 ... 18J to 22 21 to 24 40-44 ... 17 to 19£ 20 to 23 36-40 ... ' 16 to IS* 19 to 22

Feb. 24. March 10. £ s. a. £ s. d. Australasia 14 2 6 14 1 C New Sth Wales 40 7 6 40 10 0 National of N.Z. 7 1 3 7 0 0 New Zealand 2 14 0 2 13 0 Union 15 0 0 15 0 0

London. N.Z. £ s. d. £ s. d. Australasia, 14 1 6 14 2 t; Now 8th Wales 40 10 0 41 10 0 National of N.Z. 7 0 0 6 15 6 New Zealand 2 13 0 2 12 6 Union 15 0 0 14 0 C

year as follow:— Net profit Brought forward Available Dividend and bonus 13 per cent. To Reserve Fund Off bank premises Carried forward Oct. 1923. £ 018,559 121,868 Oct. 1924. £ 629,905 120,427 740,427 520,000 100,000 120,427 750,332 520,000 75,000 25,000 130,332 £740.427 750,332