INVESTMENT MARKET REVIEWED.

Auckland Star, Volume LXVII, Issue 67, 20 March 1937, Page 4

INVESTMENT MARKET REVIEWED.

EASING IN BUSINESS.

GETTING READY FOR HOLIDAY

NAT. BANK SHARES ADVANCE.

After a period of exceptional activity investors appear to be taking a spell. Various factors are contributing to this result. For one thing, the near approach of holiday time is always a bearish factor, for at such seasons people are more concerned with spending money than with saving it. Moreover, March 31 marks the end of the financial year with public bodies. Banks and a big proportion of business firms and investors are inclined to await the results of the latest year's accounts before making fresh commitments. Then again the element of speculation, which played an important pai t in the very heavy business recorded a few weeks ago, provides its own antidote. Profit taking becomes a feature and. unless fresh stimulant is available, the boom gradually subsides till comparative stability is attained and trading relapses to normal dimensions. Whatever the cause or causes, the fact is that business for the week which ended last night has eased down considerably. These remarks are equally applicable to Australia and to this Dominion. The Commonwealth Exchanges are due to close for tlii> Master vacation next Wednesday, so that inter-Exchange business across the 'J'asman will not amount to much during the interim. Banks in Good Demand. Although s.iljs were considerably less last week there was no pronounced weakening in \*hluos. A healthy tone was manifest in the bunking section. Xew South Wales touched their highest point for several years, with business at £37, after which buyers raised their offers another 5, without success.

Nationals of New Zealand moved up sharply, selling first at 65/ and later at 66/, a rise of 3/ in the week. The shares are £7 10/ units paid up to £2 10/, and in recent years have carried 4 per cent dividend, payable in British currency, free of income tax. Net profits last year at £102.504 showed a drop of £30,000, and

were the lowest for a considerable period. However, the financial year ends this month, and it seems evident that more favourable results are expected. If these hopes are realised it is likely that the directors will follow the lead of most of the other banks and raise its- dividend rate.

Special attention was directed towards ; the piefercnec shares of Commercial Bank, which realised their highest level . for a considerable period with a final sale at C 9 I! (I. a rise of 1,0 this week. Even at the higher rate they (five the excellent return on outlay ot 4U per cent per :ui ii urn. Xew Zealand* had rather a dull week. Starting at -11 the shares dropped to 43/, hut recovered later to sell at 43,6. The I) mnrti!-ii!i' scrip is still neglected and offers to sell at "Jti i) brought no response. Insurances Neglected. Insurances are still in the doldrums. Xew Zealands were firm at £3, but other issues were down. South British dropped 1 3 in the week, with a linal sale at 04/0, and Standards sold 1/7 lower at 56,0. Insurances are cheaper in proportion to other securities than they have been for years. On present valuations the South British return on outlay to the investor is approximately 2 4-5 per cent per annum, Xew Zealand 3 1-3, National 4 1-5, and Standard 4 2-5. Nervousness in regard to suggested political action is given as the only explanation of the present comparative weakness. Fixed Term Securities. Government stocks continued quiet, and the demand for local body securities was irregular. At a number of calls there were no inquiries in this latter class, and sales which took place seemed to favour buyers, who are able to command approximately 4 per cent per annum on outlay. The few sales of Government stocks which were recorded showed no change in price, which means that latest purchasers have secured another week in interest accrued. Based upon redemption at the earlier date of maturity the 1052-55 4 per cent stock gives the present purchasers a little better than 3 4-5 per cent per annum on outlay. Mining. Activity in the mining section was again closely associated with the fluctuations of the base metal markets. With tin back to £300 a ton, lead at £32 and electrolytic copper just short of £80, it is not surprising that shares of the companies concerned in the production of these metals should receive special attention. Gold, too. is slightly firmer in price on the world's market, and the bigger companies with assured outputs appear to have a bright future. Placer Developments, which has extensive interests in many parts of the globe, including a predominant share in Bulolos, were in keen demand, and the dollar scrip sold readily between £5 6/ and £5 6/6. Mount Morgan 5/ shares were steady between 18/5 and 18/6. and Rawang Tinfields fluctuated between 13/9 and 14/. The Waihi group are interested both in gold and tin. having extensive holdings in the Pnket Tin Dredging Company. The holding company, Waihi Investments, had business at 15/6. a rise rt 2/4 in the last five weeks, and Grand Junctions sold at 3/11. The 5/ shares of Broken Hill South changed hands 1/ lower at 58/6. There was little interest in purely domestic issues, and even the announcement of dividends from such successful dredging enterprises a* Argo, which has notified its seventh Id dividend, fails to stimulate this particular market. Australian Issues. Though speculation was less in evidence in regard to Australian securities, turnover was substantial and business covered a wider range than usual, with values on the whole well maintained. Woolworths suffered a reaction when the directors' policy in regard to »ew capital and final dividend was announced. Apparently something better was expected and the shares dropped sharply, with sales from £8 to £7 6/. A slight recovery then took place, with business at seven guineas and more available at that figure. Selfridges eased slightly, with sales of the

old issue from 38/9 to 37.9, and of the new at 37.'. The Xew Zealand issue (4/ paid) was on offer at 4,6 with no buyers in sight.

British Tobaccos failed to maintain the recent peak price and offers to sell at 52/6 were met with buyers' limits of 51/3. The metal producers and manufacturers had an active market with moderate fluctuations. Mount Lyells eased from 53/ to 51/9, but Electrolytic Zincs, after paying a half-year'* dividend, were still in demand at 63/9 for the ordinaries and 1/ higher for the preferences. Broken Hills sold from 90/ back to 89/3, while the pref:rence shares of its associate, Australian Iron and Steel, moved up to 28/9. Amongst miscellaneous issues the most conspicuous move came from Colonial Sugars. Sales of the £20 shares were made froth £43 to £43 5/, but purchasers were then faced with sellers' reserves of £45 5/. and no further business was put through. Spreading comparisons over a long term. Colonial Sugars is the greatest money-spinner of them all. The market is evidently impressed by the improvement in the raw sugar market. Dominion Industrials. In a quiet week for Dominion industrials a notable feature was the announcement of the Farmers' Trading Company on Wednesday that its new capital issue was already more than half subscribed; £200,000 is a substantial sum to be sought for investment in a single security within a short period, but the company has had as a background a sound balance-sheet and a fine record of profitable operations. With present results as a guide the directors are confident that the full amount will have been subscribed by April 7, the date at which the offer to sell at 21/ is to close. In miscellaneous issues there were not many changes. The coal section has shown some improvement since the industrial agreement was announced. Taupiris sold during the week from 15/3 to 10/0, and a buyer came in for l'ukemiros at 18. 0. Consolidated Bricks were a little easier towards the (lose of the week with a filial market between 9/0 and 10/. Milne and Choyco's shares were in regular demand and the debenture stock sold unchanged at 16/9. Cas shares were steady at 22/. Breweries were moderately active. Xew Zealand* sold from 59 6 to 59,3, Dominions at 40/, and Tuis at 57/.

Wilsons Cement lingered for a few flays at unusually low levels, selling at 32/9, but later improved with a final transaction at .35/. At present, when this is apparently under the cloud of a Government threat, it may be as well to remind investors of its exceptionally strong financial position. At last balancing, against a capital of £300.000 and sundry creditors £70,000, it had asset* totalling £626,500. and these included £321,000 in cash and Government stock. Trend of Market. The following table indicates the fluctuations in the values of various securities:— Dee. 22, Mar. 12, Mar. 19. 1936. 1937. 1937. £ s. d. £ s. J. £ s. <1. Aus'agia .12 8 <i 13 1 * 13 1 (i Commercial <» lit o o in r> o lo r> K.S. and A. 5 19 O 1! 10 n li In 3 Nat., X.Z. 3 4 II 3 3 i» 3 (i 0 Nat., Ans. 7 7 li 7 111 li 7 1!i I! X.S. Walis 35 o o 31". 17 I'. 37 111 li X. Zealand 2 1 li 2 3 :» 2 3 li Union ... 10 7 li 11 2 o 11 2 o M 1 SOELLA XEOUS. £ s. d. £ s. (I. £ s. d. X.Z. Insur. 3 0 li 2 10 li 3 O O S. British 3 14 3 4 Hi 0 4 14 9 Golds., M. 1 15 !l 1 17 'J 1 18 li British Tob. 2 8 3 2 13 l> 2 12 II Broken Hill 4 2 li 4 Hi 0 4 9 (» Klec. Zinc 2 10 0 300*3 40 Elec. Zinc (pref.) . 2 12 0 3 6 0 »3 5 0 Col. Suarar 43 5 0 43 0 O 44 n l» Auclc. Gas 13 li 121 121 X.Z. Brew. 2 14 0 2 19 (i 2 19 0 Dom. Brew. 1 18 9 1 19 6 1 19 9 GOVERXMEXT STOCK. £ s. d. £ s. d. C s. d. 1952-55 101 sli 103 01l 103 l> n 1039-52 102 U 0 101 15 U 101 15 (I 1953-57 — 99 0 0 98 15 0 •Ex dividend. Latest Sales. Sales since the last review have been as follow:— .Bank*.—New Zealand, £2 4/ (5), £2 3/9, £2 3/6, £2 3/, £2 3/6; National of New Zealand, £3 5/, £3 6/; Commercial, 19/5 (3), 19/6, (pref..) £9 6/6; E.S. and A., £6 10/3; New South Wales, £37. Insurances.—National, 18/ (2), 17/11; New Zealand, £3 (5); South British, £4 15/, £4 14/9; Standard, £2 16/9. Government, Etc.—Bonds, April 15, 1946-49, 4 per cent, £103; stock, February IS, 19*3-46, 4 per cent, £101 5/ (3;; April 15, 1946-49, 4 per cent, £103; June 15, 19j2-55, 4 per cent, £103. City of Auckland, January 1, 1914-07. £ 103 10, ; Mount Albeit Borough Council, .July 1, 1904, £105, .lulv 1, 190/\ £105; ' Mount. Fden Bmough Council. April 1, 1951-56, £liil JO,; .April 1. 1919-.4, £104; New l»lvmollth Harbour Board, 1951, £101 15/. Mining. Golden Crown, 4,0, 4,9; Mataki, 9d; W'aihi Investments, 15,0; Gland Junction, 3/11; Broken Hill South, £2 18/6; Mount Morgan, 18,6 (2;, 18,5, 18.6 (3); Placer Development, £5 By, £5 6,6, £5 6/; Kawang Tinfields, 13/9, 13/11, 14/ (4), 13/9 (2); Wellington Alluvials, Australian, Etc.—Australian Glass, £4 13/, £4 12/9; Australian Iron and Steel, (pref.) £1 8/9; Broken Hill Proprietary, £4 10/ (2), £4 9/6, £4 8,9 (2), £4 9/3 (2); Colonial Sugar, £43, £43 5/; Duulop, Perdriau, £1 0/4, £1 0/3, £1 0/2, £1 0/3; Electro. Zinc, £3 4/, £3 5/, £3 6/, £3 5/, £3 4/6 cx div., £34/ (5), (pref.) £3 6/0 £3 0 0, £3 0,3, £3 6/ ex div., £3 5/ (2); G. J. Coles, £5 5/. £5 4/0, £5 3/0. £5 4/; Goldsbrough, Mort, £1 18/. £1 18/3, £1 18,6; Hume Pine, £1 0/5; Kauri Timber, £1 3/; Morris Hedstrom, £1 10/6; Mount Lyell, £2 13/. £2 13/3. £2 13/4, £2 13/3. £2 12/10. £2 11/9. £2 11/, £2 10/3. £2 10/0, £2 11/6. £2 11/9; Morts Dock, 14/7; New Zealand Loan ami Mercantile. £45; P. and 0., £2 0/3; Tooths Brewerv £•' 16/6; Yarra Falls. £2 3/; Selfridges," fold) £1 18/9. £1 17/9. (new) £1 17/; Woolforths. (Sydney) £8, £7 19'. £7 10 (2) £7 8/6. £7 7/6, £7 6/, £7 6/6, £7 7/, £7 6/9, £7 6/6.

Dominion.—Auckland Gas. £1 2/ (2); Consolidated Brick, 10/ (3); Dominion fertiliser. £1 3/10'^: Dominion Breweries, £2; Dominion Investment. 15/0; Devonport Ferry, £1 0/9; Dental and Medical. 12/2; Hill and Plummer. £1 0/6; Kaiapoi Woollen. 14/2; K.D.V. Boxes, (con.) .5/3; Milne and Chovce, (deb. stock) 16/0; Xortliern Roller Mills. £1 2/6: New Zealand Breweries, £2 10/6. £2 10/3: New Zealand Drug. £3 16/6; New Zealand Farmers' Fertiliser, £1: New Zealand Perpetual Forests. £2 11/; Sanford. 5/6 (2)Taranaki Oil. 4/2, 4/7. 4/2; Taupiri Coal' 15/3. 1.5/6. 16/ (2). 16/6: Traders' Finance! (con.) 4/7: Tui Breweries, £2 17/: Wellington Meat Export. 5/8; Wilsons Cement, £1 12/9 (2), £1 13/ (2). £1 13/6 £1 15/; Woolworths, (New Zealand) £7 6/.