THE WEEK REVIEWED.

Auckland Star, Volume LX, Issue 230, 28 September 1929, Page 4

THE WEEK REVIEWED.

NOT QUITE SO BUSY. BANKS SLIP BACK. TREND OF MONEY MARKET. Another week of comparative quiet has been experienced on the Auckland Stock Exchange, and recorded sales have been little more than half of those registered during a really busy period such as the laet week in August. As has been pointed out in these columns frequently of late, it was an anomaly that there should be a continuation of marlced activity on the Sbjci; Exchanges of the Dominion with stringent conditions everywhere else. That this activity kept up so long has been due to the fact that surplus funds had accumulated in the Dominion, but money is actually more volatile than oil, and will inevitably find its own level. When all is boiled down the hard fact remains that New Zealand's economic structure is chiefly founded on London, and this Dominion can never fail for long, to be affected by financial disturbances in the Old Land. Even before the Bank of England raised its rediscount rate monetary conditions in the Old Country were sufficiently complicated to depress the securities market, and the Hatry developments added another unsatisfactory element at a most inconvenient period. Another bearish factor at the present time is the condition of finance in the Commonwealth. A tightening process has been evident for some time, due partly to the pressure of taxation resultant upon overborrowing and partly to the slump in wool. The present political upheaval has accentuated this trend, as capital is notoriously sensitive to political changes. Coming nearer home, the financial policy outlined by Sir Joseph Ward indicates that he intends to call on the Dominion s resources for a good many millions, and this will obviously curtail the amount available for private investment. Banks Drop Back. Following on ' this general downward trend in the money market,, it is not surprising to find that Bank shares have been the first to feel the pinch, for their stocks are freely dealt with in London and Australia, as well as in this Dominion. The past week has seen a definite weakening in every bank share listed, and in some oases the drop has been quite substantial. Going back only a fortnight the following changes may be noted: — APPROXIMATE MARKET PRICE. Sept. 12. Sept. 27., Fall. Australia or Commerce. £116 O £114 0 £0 2 0 Commercial of Australia.. 110 0 190 010 English anci Scottish... 890 860 030 National of N.O 618 0 615 0 03 0 National of Australia.. ID 15 6 19 12 O 0 3 6 N.S. Wales.. 52 2 0 51 5 0 017 6 New Zealand 33.0 3 23 009 Union 15 2 6 14 14 0 0 8 6 In connection with the drop recorded above, last week's remarks may be again emphasised than an investor who intends to leave his money in Bank shares need have little concern over market fluctuations. It is quite possible, indeed likely, that earnings may decrease as the result of lower prices for Australian and New Zealand primary products, and the financial stringency in the Commonwealth, but all the banks have very substantial reserves, and it is extremely unlikely that dividend rates will be lowered in any single instance. From that point of view Bank shares seem better buying to-day than they have been for some time. In the Doldrums. In a fortnight there have been gnly three Insurance sales recorded on the local Exchange- The continuous upward movement in the main lines listed seemed to receive its first check last month when the New Zealand failed to raise its dividend rate, but it is only within the last fortnight that a definite weakness has been discernible. Even to-day holders refuse to accept the view that their scrip is dear and have only reduced their reserves ' slightly. Buyers, however, are standing off, and at time of writing there are mo declared offers for A.P.A., New Zealand, Queensland or South British, a most ■unusual circumstance. Gilt-edged Lines. It might have 'been expected that the gilt-edged stocks would have responded to the external monetary pressure already referred to, but so far there has been no sign of any weakening in this section. Government stocke are in daily request at recent rates, and many sales made have been right up to recent values. Several parcels of Harbour Board loans have changed hands, and here, too, there has been no concession by the holders. Farmer Financiers. The very excellent report issued on Tuesday by the Farmers' Co-operative Auctioneering Company has been well received on the market, and a sale of the £5 shares took place yesterday at £4 10/. A year ago £2 18/ wae the best offer obtainable. Dalgety'e have eased, with sellers at £15 (shares £5)", whilst Loan and Mercantile* have maintained recent values, with a sale at £125 10/ for the £100 scrip. Golds•brough Morts have eased further, with a sale at £2 4/. This shows a drop of 7/3 on the price a year ago, and reflects clearly the change that has come over Australian conditions in the interim. Coal and Gas. There has been no weakening in coal and gae, though sales have not been so numerous <ae during the previous week. At the annual meeting of Pukemiro the chairman of directors, Mr. J. Catchpole emphasised some salient features affecting the industry, and indicated that the past record of iprofite might not be possible in future. Gas shares at £1 4/9 reached their highest level since the. interim dividend was paid in JulyBreweries' Steadier. After the sudden spurt last week, -which appears to have been unwarranted, Breweries' scrip has again steadied, though holders are endeavouring to maintain the higher levels. Miscellaneous. The chief feature in the miscellaneous section has been that a definite weakness in Australian issues, referred to in last review, has been accentuated in the meantime. A couple of sales of Electro Zmo were made at £1 16/11 and £1 16/8 respectively for the ordinary and preference shares. This marke a drop of over 3/ on the previous local sales, and brings bhe scrip back to the value it held before the jump of three weeks since. An interim dividend has "been paid in the meantime. Locally Farmers' Fertiliser has eased further, with a sale at £1 2/3. As with the Australian concern a sudden Jemand, based on unsupported rumours had led to sharp advances, which naturUly proved but temporary. Another line which seems to have been >ver-priced has been Wilsons Cement, and ifter sales a few weeks 'back at up to £2 5/ buyers have receded to £2 3/. Mining. Mining issues have been fairly quiet. fVaihie have held their value, with sales it 13/4, but Mount Lyells, in sympathy vith other Australian issues, are a little >aeier. Local Shipping. The two local shipping lines, Devonport Steam and Northern Steam, have both lardened up after a period -of weakness. vTorthern Steam recently sold one of its -eseeLs, the Matangi, which would pro>ably benefit its liquid resources. Devon>orts are liable to be affected at any time ►v the fluctuations in public opinion conlerning the possibilities of a bridge being α-ected over the harbour, whence its pronipal revenue is derived.