BUOYANT MARKETS.

Auckland Star, Volume LIII, Issue 90, 17 April 1922, Page 5

BUOYANT MARKETS.

OPTIMISM IN ENGLAND. HEW BANK RATE'S EFFECTS. BUTTER POSITION STRONG. SUFPXTES STIU LIGHT. (By Cable.—Press Association.—Copyright.) (Received 0.30 a.m.) LONDON, April* IC. The Stock Exchange closed for the holidays in a most cheerful mood, thanks to the Bank of England's Easter gift in the shape of a reduction in the bank-rate, which surprised everyone, as it was not expected till next week. The markets did not respond immediately the reduction was announced, but later there was considerable buoyancy, and \ most prices closed at top, with business broadening in every department. Even before the reduction the markets had been unusually active, iiT marked contrast to the dullness which is generally apparent on the eve of the Easter vacation. All departments were brisk, with prices tending upwards. This was most noticeable in investment securities, but speculative stocks were also receiving support, largely of foreign origin. There seems the prospect.of an early revival in speculative activity, for the Stock Exchange Committee announces subject to confirmation at a meeting , on May 15 the repeal of the temporary emergency regulations, which have been in force since January, 1915. If confirmed this will mean the Stock Exchange reverting, probably early in June, to pre-war practices regarding fortnightly settlements in Contangoes, except in British funds, Colonial provincial Government securities, which were excluded from the new arrangement because of the expected huge increase in the volume of business in giltedged securities as a result of war issues, would make the settlement business nuwieldy. This exclusion is meeting much opposition from members, and \ may cause the committee to postpone I confirmation. j The reduction of the bank rate to the I figure at which it stood on the eve of the declaration of war is hailed with satisfaction in trade circles. It is regarded as proof that the period of dear money has terminated, and is expected to have a tonic effect in stimulating trade activity, in which a revival has already commenced. All that is wanted now is reduction of the income tax. A few weeks ago it was confidently predicted that the Chancellor of the Exchequer would make a substantial reduction in view of the possibility of an early general election, but now the Government's opponents suggest that the election will not be held till late in the year, therefore the need for reduction of income tax does not exist, but the public is still hopeful. The outlook for Australasian apples is distinctly promising. Arrivals so far have been much below the usual standard of quality, the chief fault being immaturity, while bitter-pit is notice-1 able in several varieties, but all met with good demand. It was feared at one time that heavy Australasian supplies would be too much for the demand towards the end of the season, hut the cold weather, exoerienced during the last month greatly retarded soft fruits, and the season generally, is at least three weeks later than usual. The | Tesult is expected to be that the bulk of the Australasian fruit will arrive before there is any great ouantity of soft fruits available, so the Australasian mipht to do well. Although butter prices have again fn.llen there is no reason for alarm, as th« position is inherently strong. The only cause of tho relapse iwns that riricen had been raised too rapidly. and | the reaction w*s inevitable. Buttor I siiDnlies from 'all sources seem hardly' likely to suffice for the consumptive demand, and trartera anticipate keen inauirr after the holidays. Home production is 'still backward despite the nlentifulnpss of milk, end little is likely to come from the Continent, which is still bnvins on onr market, orders even coming from France.—(A. and V.Z.)