THE WEEK REVIEWED.

Auckland Star, Volume LXIII, Issue 239, 8 October 1932, Page 4

THE WEEK REVIEWED.

PERIOD OF NORMAL TRADING. GOVERNMENT STOCKS FIRMER. EASING IN SOUTH BRITISH. In many respects trading on the Auckland Stock Exchange for the week ending last night was very similar to that of the preceding period. Turnover has been maintained steadily at moderate dimensions and there have been few marked variations in the trend of the market. Amongst major happenings since last review has been the production of the financial Budget in Parliament. Although the Government Statement was well received the only apparent effect on the investment market has been a slight hardening in the values of Government Stocks. Banks. As is usually the case, the banking section attracted special attention,, and most of the main lines' were bid for at each call. At the same time, it may be noted that there was little zest in the bidding, and buyers seem quite content to sit tight on their limits. This is scarcely to be wondered at, for current values are fairly high when considered in conjunction with the low rates of dividend that have been paid lately. There is no good reason to suppose that these rates will be substantially increased for some time to coine. In the case of some trading concerns 1932 may prove the worst year in the present slump period. Although there are many signs to indicate that the lpwest depths of the world depression have been left behind, the accumulation of inevitable losses had not reached its maximum last trading year. This state of affairs will be directly reflected in the profit and loss account of the banks who are buttressing many big firms that have still to emerge from very difficult conditions. Fortunately — and this is strikingly illustrated in the latest banking returns — all the banks trading in this Dominion have maintained their position of exceeding strength to a remarkable degree. After two years of the most difficult trading conditions known to the present generation their financial strength has not been seriously impaired. They are still able to lend assistance in the way of credit wherever that assistance seems justified, and their shares offer such irreproachable security that they can well bo termed gilt-edged. This, of course, explains the willingness of investors to pay the high prices that have been ruling of late. Coming to individual concerns, the Bank of New Zealand was responsible for more sales than all the rest combined. The easing tendency referred to the previous week continued till the market- steadied again at £2 6/. This shows a drop of 2/3 from the peak price realised on August 5, but is still 5/ above the value ruling at the middle of June.

Commercials were steady, with sellers prepared to take 14/9. The only recorded transaction in this scrip was at a penny lees. National Bank of Australasia was in regular request, and the contributing issue liad a sale at £5 15/6, which showed a rise of 19/6 over the previous transaction, which was in March. Trend of Market. The trend of the market since Christmas !Lvc is shown in the following table:— BANKS. Bee. March Sept. Oct. 23, IS, 30, 7, 1931. 1932. 1932. 1932. Australasia: .... ISO/ 181/ 195/ 19S/ Commercial .... 16/5 33/11 14/9 14/8 L.S. and A. ... 93/6 SO/ 95/ 94/9 Rational (N. 55.) 80/ 67/6 80/ 70/ Rational (A'sia) 200/ 192/ 231/ 231/ N South Wales 570/ 497/6 560/ 565/ New Zealand . . 45/ 42/6 47/ 46/ Unlon 157/6 135/ 155/ 155/9 MISCELLANEOUS. Dee. March Sept. Oct. 23, 18, 30, 7, 1031. 1932. 1932. 1932. • 40/(i 43/ 43/ South British . . 54/ 49/ 57/6 56/ Goldsbroiiffli, M. 24/ 21/6 24/ i) *>A/n Colonial Sugar . 830/ 720/ 970/ 905/ Auckland Gas .. 23/10 21/9 21/3 21/6 The above table indicates that values S!!, ■ ti ave been fair] y stable during the past week. Insurances Popular. Insurances have again been in steady demand and buyers not only sought the regular lines at each call, but also put in ?" n ' q, "7i f , 0r A - P - A ' s > which had not bee;! quoted for some time. There was a bid for the 10/ scrip at 4/6

An unusual feature was a drop in the price of South British, which sold 1/ cheaper at £2 16/. At the lower rate interest 111 ,tlie scrip was keener.

New Zealands, on the otfier hand, were very steady and had a number of sales at £2 3/, a rate that has not altered materially 111 the last fortnight. Nationals had a sale after the noon call on Saturday at 15/, but' this proved to be the peak in the recent advance and subsequently offers to sell at 14/10 failed to bring business. Fixed Term Securities. There was a better demand in the section comprising Government stocks and local body issues. Four and a half's sold first at £95 2/6 and later at £95 5/. j. he last sale shows a rise of 5/ on the previous week, but of this advance approximately 1/6 is represented by the further addition to accrued interest. The same factor applies with the s%'s, which sold 2/6 bettor at £99 5/.

A sale of 4% s (1941) at £94 10/ seemed to represent a high valuation, for the return to present purchaser after allowing for redemption at maturity and payment of 10 per cent stamp tax, is only a little over 4% per cent. At the same time, it should be noted that the stamp tax has been fixed for three years only and may not be operative after 1935. In this connection the following table should be of interest to investors:— Interest return Current Accrued per Government price. interest, annum* Loan. £ s. d. s. d. ±J s. d. 51 (1937. Sept.) 99 r, 0 10 3 5 2 6 5J (1937) 96 5 0 13 S 5 10 9 41 (1938) 95 5 0 1 12 5 5 3 15 41 (1941) .... 94 10 0 8 5 4 16 6 *Tlie column headed "interest return" shows the annual return to the present purchaser based on redemption at maturity and after allowance has been made for the Government stamp tax of 10 per cent. Mining. There has been fair interest in mining, but few changes in the market. Waihis, with a shilling dividend only a few weeks away, moved up 3d, with sales at 17/3. There was a steady demand for miscellaneous issues at late rates. The recovery in tin prices brought further business with Kuala Kampar and there were also regular inquiries for Rawang scrip. Both these concerns have recently issued accounts which appear to show ability to survive the disastrous slump that has temporarily crippled the tin mining industry.

Australian Issues. Extreme buoyancy on Australian exchanges has not been fully reflected locally and Commonwealth scrip has not attracted quite as much attention as was the case a few weeks ago. Even Colonial Sugars, which were expected by some to reach £50, found peak at £48 10/, and then dropped back to a sale at £47 17/6. This only proved a minor check and later business was done at £48 5/. British Tobacco improved its position with sales first at £1 10/9 and later at £1 11/3.

Dominion Scrip. Dominion issues met with a fair demand and most of the more popular shares retained recent values. Apart from those regularly traded in there were two sales in the coal section, one of Kaitangatas at par, 16/, and the other of Taupiri ordinary £1 shares at 13/6. Wright, Stephensons £1 preference shares changed hands at 15/. Latest Sains. Sales completed since last review have been as follow: — Banks: New Zealand, £2 6/9, £2 7/, £2 6/11, £2 6/10, £2 6/ (2), £2 6/1%, £2 6/; Commercial, 14/8; Commercial (pref.), £7 3/; National of Australasia, £5 15/6; E.S. and A., £4 14/9; New South Wales, £28 5/. Insurances: New Zealand, £2 3/ (5); National, 15/; South British, £2 17/, £2 10/ (2). Breweries: New Zealand debenture stock, £1 0/6. Government issues: 4% per cent (1938), £95 2/6, £95 5/; 4% per cent (1939), £95 5/; 4% per cent (1941), £94 10/; 5% per cent (1937), £99 5/ (2); 5Ms per cent (1936), £99. Local bodies: Mount Roskill, 5% per cent (1960), £98; Central Power Board, 5% per cent (1957), £95; Devonport Borough Council, 4% per cent (1937), £91. Mining: Waihi, 17/3 (2); Blaekwater, 18/; King Solomon, 1/10 (2); Golden Point, 7d, 8d; Golden Dawn, 5/; Kuala Kampar, 6/9; Okarito, 8/6.

Australian issues: British Tobacco, £1 10/9, £1 11/3; Henry Jones, £1 9/9; Mount Lyell, £1 1/3 (3); Colonial Sugar, £47 17/6, £48 5/ (2). Dominion issues: Wright, Stephenson (pref.), 15/; Wilsons Cement, £1 13/9, £1 13/6; Union Oil, £1 4/6: Auckland Gas, £1 1/6 (3); Traders' Finance (7/6 paid), 2/6; Woolworths (pref.), £1 6/3; Kaitangata Coal, 16/; Farmers' Fertiliser, 16/9; New Zealand Refrigerating (con.), 3/9; Taupiri Coal, 13/6.