THE WEEK REVIEWED.

Auckland Star, Volume LXIV, Issue 83, 8 April 1933, Page 4

THE WEEK REVIEWED.

A FAIR TURNOVER.

GOVERNMENT STOCKS OFF MARKET

INVESTORS AWAIT OFFERINGS

The temporary cessation of dealings in Government stocks has brought about a marked decrease in sales on the Auckland Stock Exchange. Investors have been compelled to turn their attention to other sections, and in some of these more activity has been displayed. This has been especially noticeable in the banking division. The market tone, generally speaking, has been very healthy with a keen demand for all approved securities.

At the end of nearly three years of depressed business conditions there are still ample supplies of money for investment, and this has again been evidenced by the quarterly returns of the trading banks. Funds are being held back from free circulation because investors do no;, believe the average business enterprise can earn sufficient funds to pay a reasonable dividend. Whenever it becomes possible for the Government to reduce its crushing burden of taxation, then, and not till then, will investment funds be spread evenly through the whole field of legitimate commercial enterprise. It is a fact not realised by many that even with conditions as difficult as they are, the spread of investment in Auckland is much wider to-day than it was a year ago. Stocks generally are valued higher, and this movement is not entirely due to the lowering of interest rates on Government stocks. Persons who bought approved industrials at this time last year have had no reason to regret their confidence; they could sell to-day at a profit.

The demand for Government issues was insistent all the week, but although buyers steadily advanced their limits their best offers failed to bring holders to the market. It would seem that the majority of new stock holders have not ascertained their exact position in regard to maturity dates, and those who have are not desirous of parting with what they look upon as a permanent investment. That the market for the converted stocks will open at a high valuation is indicated by the fact that up to. £99 10/ has been offered for the 4 per cents and £97 for the 3's.

There was a distinct forward movement in the debentures of local bodies. Although there is still uncertainty as to the effect of the recent legislation upon the scrip of specified public bodies, the impression is gaining ground that some of them will, when converted, become attractive propositions even at the lower rates which the law permits them to pay. Meanwhile, existing stocks are bringing well up to late rates, despite the fact that interest as from April 1 is subject to 20 per cent reduction. Sales of Auckland Hospital Board and Auckland City debentures support this conclusion. Banks Busier. There were more sales of bank shares than had been the case in recent weeks. New Zealands, as-usual, attracted most attention and moved steadily upwards from £2 4/6 to £2 5/, thus returning to the valuation of February 7.

Commercials with business at 14/1 and New South Wales at £29 were steady at late valuations. Nationals of Australasia (£lO shares) had their first sale for a considerable period. This transaction at £12 3/6 marked a rise of £2 3/6 since this time last year. The contributing issue at £5 18/6 was 6/ higher than the last sale in January. The announcement that the directors of the English, Scottish and Australian Bank are making an interim dividend at the lower rate of 2% per cent caused buyers to withdraw temporarily. The reduction should not surprise anyone. Last year the rate was 3 per cent, but at the hnal distribution only 2 per cent was paid. Net profits in recent years have iallen very considerably. For the 12 months ended June 30, 1930, they were £542,736. Slump conditions brought them down to £266.657 in 1931, and last year they were still lower at £147,719 To pay thei 5 per cent dividend for the year £150,000 was required, so that a slight encroachment had to be made upon reserves. On the subject of Australian bank dividends, "The Times" (London), of February 24, says:— There is ground for hoping that the heavy fall which has taken place in Australian banking profits in the past three years may now be checked. During the current year the banks should reap greater benefit from the economies which have been made in working and from the renewal of time deposits as they mature at lower interest rates, while commercial conditions have shown some improvement."

Trend of Market. The trend of the market since Christmas Eve is shown in the following table: ~ BANKS. Dec. Mar. Mnr. April 22. 24, 31, 7, 1932. 1933. 1933. 1933. Australasia ...: 180/ 195/ 208/6 208/6 Commercial .... 13/6 14/3 14/1 14/1 E.S. and A. .. . 82/S 86/ 87/6 80/ National (N.Z.) 65/ 06/ 66/6 66/6 Nat. (A'sia) con. 105/ 112/6 115/ 118/6 N. South Wales 520/ 580/ 580/ 580/ New Zealand .. 40/6 43/10 44/4 4jj/ Union .; 135/ 146/ 148/ 147/6 MISCELLANEOUS. Dpc. Mar. Mar. April 22, 24, 31, 7, 1032. 1933. 1933. 1933. N.Z. Insurance . 41/ 48/ 48/ 48/3 South British . . 54/ 62/9 63/3 64/6 Goldsbrough, M. 21/6 23/ 22/6 22/9 Colonial Sugar . 920/ 1085/ 1085/ 1095/ Auckland Gas .. 21/ 21/1 21/1 21/1 It will be noted that the bank and insurance sections are rated well above the pre-Christmas valuations. Insurances Popular. There has been an unsatisfied demand all the week for insurance scrip, and, as a consequence, prices have shown further advances. New Zealand with sales at £2 8/3 and South British up to £3 4/6 illustrate a firm tendency that covered the whole section. In the view of the writer this class of scrip is still good buying at latest rates. Mining. There were no special features in the mining section. Waihis were steady at £1 2/, and Grand Junctions firmed up a little with business at 3/10. limprovement in world metal prices revived interest in Malayan scrip, and Kuala Kampars had a sale at 5/. Australian. Australian general securities figured more prominently on the sales sheet than had been the case of late. Colonial Sugars showed fresh firmness and final sales at £54 15/ represented the highest level recorded since before the slump. A year ago this scrip was selling at £36, so that there has been a rise of 50 per cent in that period. Mount Lyells eased 9d with sales at 18/9, and Goldsbrough, Morts improved 3d with business at £1 2/3, while Australian Glass had a good sale at £2 6/3 for the £1 shares. Huddart, Parkers also changed hands above par with £19/ given for the ordinaries and £1 3/6 for the preferentials. Burns, Philp shares were asked for at £2 8/ and Henry Jones at £1 17/ without tempting holders. Dominion Issues. There was the usual steady demand for specially popular Dominion industrial shares, and in addition some inquiries were made outside what may be described as "the charmed circle." Thus Whittome, Stevensons had a sale at 14/, Farmers' Trading and Farmers' Auctioneering were included in the sales list, while steady bidding took place for Northern Steam. Farmers' Fertilisers came in for special attention and improved 9d with business at 16/. Auckland Gas was steady at £1 i/1; whila Wilsons Cement advanced 3d I with transactions at £1 12/. J

Latest Sales. Sales completed since last review have been as follow: — Banks.—New Zealand, £2 4/6 (3), £2 4/8 (2), £2 4/9, £2 4/7 (2), £2 4/9 (2), £2 5/; Commercial, 14/, 14/1; ditto, pref., £8 7/6 (2); National of Australasia, £12 3/6; ditto, con., £5 18/6; New South Wales, £29; Union, £7 7/6. Insurance.—New Zealand, £2 8/3; South British, £3 3/6, £3 3/9, £3 4/3, £3 4/6. Breweries.—Staples, £1 2/9. Local Bodies.—Auckland Hospital Board, 5% (1935), £96 12/6 (2); Auckland City, 5% (1957), £98 10/. Mining.—Waihi, £1 2/ (2), £1 1/10%, £12/ (2); Grand Junction, 3/9, 3/10 (3); Golconda, 3d; King Solomon, 2/0%; Mataki, 1/3%; Consolidated Gold, 9/9. Australian.—Mount Lyell, 18/9 (2); Huddart, Parker, £1 9/; ditto, pref., £1 3/6; Colonial Sugar, £54 5/, £54 15/ (2); Goldsbrough, Mort, £1 2/9; Australian Glass, £2 6/3. Dominion.—Auckland Gas, £1 1/1 (2); Whittome, Stevenson, 14/; Kempthorne, Prosser, £3 3/; Farmers' Fertiliser, 16/ (3); Farmers' Auctioneering, A pref., 14/6; Wilsons Cement, £1 11/9, £1 12/ (2); Farmers' Trading, A pref., 15/; ditto, B pref., 7/. Unlisted.—National Tobacco, £3; Bell, Hooper, 7%d (2). BUSINESS IN THE SOUTH. (By Telegraph.—Special to '"Star.") CHRISTCHURCH, this day. The "Christchurch Times" reports as follows:—The stock markets have shown a firming tendency and prices generally are above last week's level. Turnover has again been substantial and dealings have covered a wider range. In addition to banks, attention has been given to industrials. Totals compare as follow:—This week 25,014; last week, 26,096. Analysis of business gives the following results, the figures for the preceding period being in parentheses:—Banks 1648 (1247), Insurance 650 (1525), loan and agency 100 (524), meat 1700 (1100), woollen 65 (25), coal 560 (100), gas 681, brewery 1555 (2325), miscellaneous 2105 (700), mining 15,950 (18,550).

Converting these figures into butterf.it equivalent, there is an increase of 18.894 per cent in butterfat production for the eight months of the present season, compared with the corresponding period of the 1931-32 season.