THE WEEK REVIEWED.

Auckland Star, Volume LXIII, Issue 263, 5 November 1932, Page 4

THE WEEK REVIEWED.

BUSINESS RATHER QUIET.

GOVERNMENT STOCKS PREFERRED

BANK OF NEW ZEALAND DIVIDEND

Members of the Auckland Stock Exchange have had another quiet weeu, with turnover almost rigidly confined to special lines, chiefly o£ the gilt-edged variety. There has been a steady demand for Government Stocks and this is not altogether a good sign, for it indicates that investors are not prepared to invest their surplus funds in general securities. In the banking section the demand has been slacker than haa been the case for several months, and although sellers reduccd their limits very little business was put through. A sale of E.S. and A. 4/ cheaper at £4 10/ illustrated the general weakness. Of the few sales made New Zealands accounted for the majority. For these the market was weak at the beginning, but firmed up at the close, probably in anticipation of the interim dividend ail noun cement which was published yes* terday. The notification that a reduction is to be made in the distribution will cause little surprise; indeed, a bigger decrease might have been expected. That the directors feel justified, after piloting the institution through 2Ms years of financial slump, in distributing a dividend at the rate of 12% per cent per annum should make cheerful reading to the shareholders and the commercial community as a whole. It may be accepted as a matter of course that the directors are confident that the final pavment in June next will not be any lower than the rate now recommended, and it may be higher. At the same time it would be unwise to assume that the directors expect the result of the current year to be any more profitable than was the case over the previous twelve monthly period. At the last anmial meeting the chairman of directors, Mr. Oliver Nicholson, stated that it was a policy of the board to use accumulated profits for the purpose of maintaining the usual distribution to shareholders when times of stress were experienced. On that occasion the net profits totalled £587,033, whilst the amount paid out in dividends was £817,968. Trend of Market. The trend of the market since Christmas Eve is shown in the following table:— BANKS. / Dec. March Oct. Nov. 23, 18, 27, 4, 1931. 1932. 1932. 1932. Australasia .... 180/ 181/ Commercial .... 16/5 13/11 14/9 J4/6 K.S. and A. -.. 91/6 80/ 94/ 91/ National (N.Z.) 80/ 67/6 80/ 78/0 Nat. (A'sia) con. 10;)/ 97/6 112/6 111/ N. South Wales 070/ 497/6 575/ 57.>/ New Zealand .. 45/ 42/6 45/9 46/ Union 157/6 135/ 158/6, 153/6 MISCELLANEOUS. Dec. March Oct. Nov. 23, 18, 27, 4, 1931. 1932. 1932. 1932. N.Z. Insurance . 40/6 37/ 43/6 43/9 South British . 54/ 49/ nh, Goldsbrough, M. 24/ -1/0 -4/ -3/ Colonial Sugal . 810/ 720/ 990/ 99.)/ Auckland Gas . 23/10 21/9 -1/3 21/6 The above table indicates a. general easing in Australian banks, which, based on latest dividends, have been priced rather high in recent months. Insurances Firm. TKe insurance section has been steady and firm all the week. New Zealands again reached the peak level for the year of £2 3/9 and South British sold ex div. at £2 17/, with more wanted at that figure. There were also ready buyers for Standards, Queenslands, and Nationals at late quotations. Fixed Term Securities. Under a strong buying movement, particularly noticeable towards the close of the week, Government Stocks again firmed up. Five and a half's sold readily at £100 5/, after which holders stood off, and 4%'s in the '39 issue changed hands at £95 and £95 5/. The latter shows a rise of 12/6 in the week. There were the usual offers toi sell the issues of miscellaneous local bodies, but buyers confined their attention to a few special lines, and no business was this connection the following table should be of interest to investors:— return Current Accrued per Government price. interest, annum. Loan £ s. d. £ s. d. £ s. d. SJ, 1937, Sept. 100 5 0 17 9 5 2 6 51 1937 06 15 0 1 0 6 5 11 U 1938 97 0 0 1 17 5 4 19 0 If', 1941 96 0 0 14 3 4 13 0 ♦The column headed " Interest return" shows the annual return to the present purchaser based on redemption at maturtty and after allowance has been made for the Government stamp- tax of 10 per cent. Waihis Active. Dividend time for Waihis, coupled with the substantial increase in the price of gold, resulted in a brisk demand for this ipopular scrip. Before the shilling dividend was paid on November 1 the scrip; touched a new high level at 18/6. Immediately after the distribution had been made 17/9 was accepted, but the shares then took another upward turn, and latest sales were at 18/1- Grand Junctions shared in this popularity, and sales were made from 3/3 to 3/6. _ . Amongst miscellaneous mining scrip the most conspicuous sale was when a parcel of Blackwaters changed hands at 19/, an advance of 1/3 on the last transaction. This line sold in March last at 6/, and Waihis were selling at under 14/ in June. Australians Quiet. There has been very little interest in Australian general securities, and it would appear that on the Commonwealth Exchanges investors are rushing Government issues to the _ neglect of other sections. Even Colonial Sugars failed to produce any reaction to the announcement of another profitable half year and the declaration of the usual rate of dividend. Presumably the terms of the notification had been discounted beforehand with the scrip forced up to approximately £50 for the £20 shares. Even so the return to the present-day investor of _ approximately 5 per cent is quite attractive under existing conditions. Goldsbrough, Morts have been on offer at £1 3/6 without attracting buyers. Dominion Issues. Auckland Gas led the way in Dominion issues and moved up a few pence with final sales at £1 1/6. An unusual sale on the local market was one of Wellington Gas preferential. These are £1 shares, 5 per cent cumulative, and changed hands at 18/2. After the announcement of the usual interim dividend Wilsons Cement were in demand, and a parcel changed hands 1/6 higher at £1 12/9. This is 2/ above the price ruling three weeks ago. New Zealand Refrigerating scrip, which had eased in recent weeks, recovered again. After a transaction early in the week at 2/7 the scrip realised 3/ later on. The Trend of Trade. The general trend of trade has been illustrated by many happenings during the week. Reference has already been made to the significance of the Bank of New Zealand's dividend announcement. There has, in addition, been notification of dividends at the customary rate by Wilsons Cement and Bycroft's, Ltd. The Farmers' Trading Company management has notified that the half-year has been satisfactory, albeit no interim dividend is being-made to ordinary A

similar notification was made at the annual meeting of Tattersfield, Ltd., wool scourers and manufacturers. An old-established firm, Union Oil Soap and Candle, Ltd., has celebrated its fiftieth year in business with an excellent record. Substantial net profits arc shown, and the shareholders are to receive a final dividend of 9d, making 1/6 for the year, approximately 0% per cent on the £1 suare paid to 16/. On the other hand the well-known firm of Abraham and Williams has had to record a loss on the year's operations, a result that is directly attributable to the unfortunate condition of the pastoral industry. Notable also —and in this case of grave import—has been the annual statement of the president of the New Zealand Coalmine Owners' Association, Colonel Holgate emphasised the position which has frequently been stressed in thetje columns, namely, that the coal trade in the Waikato is in a parlous condition, which can only be remedied by a complete reorganisation of the industry as a whole. Of outstanding importance to Auckland ! city and province is the decision come to yesterday by the old-established firm of Macky, Logan and Caldwell to close down. The firm has been inextricably caught in the economic maelstrom which has overwhelmed many businesses in the present slump, and the directors decided that it would be unprofitable to continue. Viewing these results as a whole as to their bearing on the future, there is warrant for the belief that many of our trading institutions are gradually clearing their way from the economic morass, whilst others can only, by the utmost care, be brought once more to a profitable basis. Latest Sales. Sales completed since last review have been ae follow:— Banks.—New Zealand, £2 5/6, £'2 5/8, £2 5/9, £2 6/; Commercial, 14/7; National of Australasia, £5 12/6; English, Scottish and Australian, _£4 10/. Insurances. —New Zealand, £2 3/6, £2 3/9; South British, £2 17/; National, 14/6. Breweries. —New Zealand, £1 7/. Government Issues.—4% (1939), £95, £95 5/; 5H (1937), £100 5/ (3); (1936) £100, £100 5/ (2); 5Vi (HV4I), £96 10/. Mining.—Waihi, 18/, 18/4, 18/5, 18/4, 18/6, ex div. 17/9, 17/10, 18/ (3), 17/11, 18/ (2), 18/1; Waihi Grand Junction, 3/3, 3/6 (2), 3/5, 3/6 (3); Blackwater, 19/; Okarito, 8/2 (3), 8/1; Golden Dawn, 5/; King Solomon, 1/10. Australian.—Colonial Sugar, £49, £49 5/ (2), £49, £49 5/ (2); Mount Lyell, £1 0/6, £1 0/4. Dominion.—Auckland Gas. £1 1/4, £1 1/6 (4), (cont.) 15/3 (2); Wellington Gas (pref.), 18/2; N.Z. Refrigerating (cont.), 2/7, 3/ (2); Taranaki Oil, 2/1; Woolworths (pref.), £1 6/9; Dominion Pictures, 11/6; Wilsons Cement, £1 12/9.