BRITISH TRADE REVIEW

Auckland Star, Volume LXVIII, Issue 26, 1 February 1937, Page 4

BRITISH TRADE REVIEW

STOCK MARKET DEPRESSED. FEAR OF HIGHER INTEREST. COMMODITIES ALSO SUFFER. LOXDOX, January 30. The second week of bank chairmen's speeches should have been a tonic to Jie markets, but investors have refused to respond to their optimistic pipings and instead have sold stock so heavily that the gilt-edged market experienced the worst setback since the black days of February. 1935. The main influence seems to have been the conviction that interest rates must rise over a long period, combined with fears of increased taxation. Nervousness over the currency situation has contributed to the unsettlement, which has extended to Dominion issues , and to many industrials.

Commodities have not escaped the prevailing depression. Most metals have been carried to rather high levels in relation to anticipated production. There id no new factor in the oil market to encourage •' bulls."' Kubber eharee enjoyed a temporary epurt following upon the International Committee'e decision to raiso the quota, but this was not maintained to the continuance of the United States utrike. Sugar i.s firmer on the announcement of the international conference, for which the industry has waited 18 months. The .British Empire dominates thie industry a« producer and consumer, therefore the chances of an agreement are enhanced, but the negotiations will be difficult, «e a considerable surplus capacity stiil exinUi. The consuming markets are so closely protected that a free world market absorbs a little ever 10 pur cent of the total production. An agreement certainly will mean a further rirte in price. In relations to other commodities sugar does not appear to be over-valued. Copra continues weak, but the tone "e steadier, with consumers showing more interest. There i e some speculative inquiry at lower levels. Wool More Settled. The wool trade ie gradually moving toward a more settled baeie. The London lead if a welcome stabilising influence, providing a solid indication of values. Britain and the Continent are prepared to support the large pastoral companies, which mostly have elected to eell at current prices. Japan's action in switching from Australia to South Africa in the interests of her own internal economy naturally is a disturbing influence, but that operators withstood it is proof of the strong position of wool. The "Yorkshire Post' says it considers that the London values are likely to have pointed eome time ahead. An important development in the Xorth Lincolnshire steel industry is indicated by the announcement that United Steel Companies, Ltd., proposes to spend £3.500.0(K) on a new plant at the Scunthorpe works. Other big Bteel concerns in that area are ali»o carrying out extensions to meet the present demand for steel.