COMMERCIAL

Press, Volume LXXXIX, Issue 27210, 30 November 1953, Page 14

COMMERCIAL

STOCK EXCHANGES WEEK’S TRANSACTIONS REVIEWED (By Out Commercial Editor.) The week on the Christchurch Stock Exchange was a fairly busy one. and it closed with a spate of business in a diversified list of stocks. Prices remained a firm throughout the week, although at 1 times a lessening of buying interest was r faintly discernible. In Australia markets F continued on their erratic course. <j Turnover for the week, with the 'pre- c vious week’s figures in parenthesis, was 4 as follows:—Government and local body securities, £8025 (£8475); banks, 107 a (444); Breweries, 700 (418); frozen meat, « a5O (1470); gas 200 (221); insurance, nil H (225); loan and agency, 600 (1700); woolImns 1 m ns 175 °, (500); miscellaneous. 10,993 t ioS : M^ , fi2 n 7 7 UnUSted ' “ <329) - * Government stocks enjoyed a moderate I turnover at firm rates. Local body securi- i ties were neglected. ’ Sales in the banking section were wholly *, confined to Bank ol New South Wales S rights, and the company’s shares which ; had a fairly free market. Quotations for the rights showed a firming tendency, „ closing with sales and buyers at £7 6s 6d. s The shares which were in short supply, c sold unchanged at £3O 10s. Dominion Breweries had reported busl- I ness at 6d, and Ballins dropped 3d to a -^ at J 2 2? M - . New sold ex * dividend at 425, in the first local sale for r several weeks. New Zealand Refrigerating were traded < unchanged at 18s 3d. s Christchurch Gas were steady in busi- a ness at 17s »d. c United Building changed hands at the 1 firm price of 20s. Dalgety's B shares lost M FL business at 10s. New Zealand Farm- 2 era Co-operative 1960 44 per cents, sold at 1 £ 97 - Buying quotations for Wright, 1 Stephenson ordinaries improved without any sellers appearing. A parcel of Timaru Woollens gained 1* to sell at 26s 6d. Kaiapoi Woollen ordin- ] aries were traded at 24s 3d. A large parcel of Feltex (New Zealand) preferences changed hands at 22s 6d. the miscellaneous section, Dunlop j New Zealand ordinaries rose 6a in business at 15s 6d. Coles sold early in the week at 17s, and with more on offer at the close, but buyers stopped at 16s 9d. KD.V. 1 Boxes gained 2d to sell at 10s 6d. Colon- J i 51.H gars were unchanged in business at £35 15s. Woolworths. Ltd., were fairly freely traded at 15s, and the closing sei- . lers quotation was Id below this figure, J with buyers at 14s 9d. McKenzies had a cum dividend sale 3d up at 16s. Woolworths New Zealand were unchanged , when sold at 18s 6d. < Fletcher Holdings, cum dividend, sold unchanged at 31s 6d. New Zealand Forest Products rose 8d to transactions at 13s 6d. Norvic Shoes gained 9d to sell at 15s 6d. Milne and Choyce were traded at 48s 6d. A Parcel of Electro Zinc preferences sold at 225. Dominion Fertilisers sold at 34s 6d. A small parcel of Farmer and Co.—a Sydney departmental store—sold at 41s. Gordon and Gotch, cum dividend, had dealings at 17s 9d. A parcel of Whakatane Board Mills preferences fell 6d in reported business at 21s 9d. Broken Hill Proprietary’ shares dropped Is to business at 34s , Paton and Baldwin returned to the sales list in business at 22s Bd. Whitcombe and Tombs rose sharply to trading at 25s Amalgamated Batteries, which have not been traded of late, sold at 27s fid on a cum dividend basis. Business in the unlisted section was confined to a sale of Christchurch Press at £l2 2s 6d. MORTGAGE RATES ( ANALYSED < < SLIGHT EASING NOW. 1 DISCERNABLE ! 1 NEW 1 REACH RECORD FIGURE 1 ■ < The average rate of interest on new J mortgages registered in New Zealand ; reached 4.47 per cent, in April and May ’ this year, according to figures published J in the Reserve Bank's October Bulletin, i “The rate has since dropped slightly,” i the bank states, “but it is too early to » judge whether this may be the beginning i of a new trend, or merely a temporary , change. In view of the .’act that the 1 yield on Government securities has re- 1 cently fallen to just under 4 per cent., 1 after rising from 3 per cent, in mid-1951 to over 4 per cent, early this year, it may be that mortgage interest rates will re- . main fairly steady at this present level.” * The market for mortgage funds has, on i the whole, been a free one, and the vary- j ing rates of interest at which loans are 1 •made reflect changes in the internal j financial position, the bank says. New mortgage registrations from 1914 . are set as follows: '

•State Advances mortgages excluded from calculation of rate. Peak of M Per Cent The rate fell slightly in the First World War, but rose to a peak of 61 per cent, in 1923. Early in 1931 restrictions were placed on the power of mortgagees to sell or take possession of properties, and in May, 1932, the National Expenditure Adjustment Act sought to bring about a 20 per cent, reduction in rates of interest payable by mortgagees. The rate was not, however, to be compulsorily reduced

less than 5 per cent. On new mortgages the rate of interest was not reduced by legislation, but owing to a reduced demand for investment money as a result of economic depression, this rate also dropped fairly steadily during the mid-thirties. The value of new mortgages registered dropped very sharply and by 1934 was less than a fifth of the 1930 figure. From 1935-46 onward, all .State Advances mortgages were included in the calculations of the average rate of interest, so that apparent reductions at this time were at Least partly due to this cause.

Following the outbreak of the last war fewer loans were made on mortgage, but the average rate of interest remained fairly stable. It fell sharply in the postwar period, when large sums were loaned to ex-servicemen at specially favourable rates For example, under the rehabilitation loans. This is the main

servicemen received loans at 3 per cent, for the purchase of houses or farms. In the immediate post-wear years over onethird of new registrations were at 3 per cent., and the majority of these would be rehabitation loans. This is the main reason why the average rate of interest □n all mortgages in 1946-47 was down to a record low figure of 3.85 per cent. The average rate moved upward after 1947 mainly because rehabilitation lending formed a smaller proportion of the total. There was no perceptible hardening in rates for private lending till 1952-53, when the proportion of new mortgages registered in the higher range of interest rates rose appreciably. Sources of Funds Although lending on mortgage is fairly widely practised in New Zealand, few details are recorded as to the source of private funds; but these account for more than two-thirds of the total. The annual report on insurance statistics in New Zealand shows that in 1950 insurance companies held mortgages to the value of £28,000,000. Other financial institutions such as trustee and investment companies, trustee savings banks, and building societies, also have substantial holdings, while .the balance of non-Government mortgages is held mainly by individuals. Government mortgage lending has been a feature of the capital market since the Advances to Settlers Act in 1894. Nowadays this type of lending is done by the Sate Advances Corporation, although the Marginal Lands Board and the Lands Department also make loans on mortgage. MINING Clnth* Dredge—For the week ending ■November 20 the Clutha River dredge, operating at Alexandra, worked 121 hours land Mcovered 113

LONDON WOOL SALE

MORE HESITANT NOTE SOME DESCRIPTIONS CHEAPER (»2. Pr«« AxweiaUml—Copyright) LONDON. November 17. The'Committee ot London Woolbroker, and the London Agency of the New Zealand Wool Commission say in a. Join* r «“ port that a rather more hesitant note prevailed in the saleroom when the London wool sales were resumed today witn catalogues comprising 7852 bales, of which 4568 were from New Zealand. Although the pattern of competition was about the same as Wednesday, buyers did not bid so freely, and some of the descriptions on offer were cheaper. ■ Several pre-lamb shorn greasy halfbred and fine crossbred clips from tiie South Island and a few crossbred clips from Hawke's Bay were available. They included many lines of good style and were almost fully cleared. Bradford top makers were the principal buyers of 50 s quality and coarser fleece wools, and the Continent was the principal buys of finer qualities and skirtings. Prices, however, were rather irregular, and sometimes cheaper than those paid on Wednesday. Irregularities were also evident in prices for Australian Merinos, which, sometimes tended, in the buyers’ favour, the offering being confined largely to topmaking descriptions. Scoured Merinos, however, except those on which seUers had placed high limits, sold well—better than at any time in previous September series—and under good competition realised firm prices, some lots being distinctly in the seller's favour. The official range of prices for New Zealand wools in the grease issued, is as follows:

New Mortgage Registrations Year ended Average Rate 1914 .. .. £r 2L4° n 5.82 1916 11 1*. 22.5 5.74 1918 11 11 18.1 5.84 1920 11 11 48*4 5.75 1922 11 11 34*8 5.4* 1924 11 11 37*9 SJ8 1926 11 11 47*1 6.22, 1928 „ 11 .. 43.6 .. 38.9 .. 30.2 6:461930 11 1931 .. , if 1932 .. •• 6J8» 1934 11 11 7.8 i? 1936 11 1937 .. 1936 .. 1939 .. 11 1&2 .. 19.7 .. 19 JO ,, 20.0 i 1941 11 11 16.3 4*69 1943 11 11 12.1 442 1945 11 11 18.1 4.51 1947 H 11 31.7 3*85 1949 11 11 35-4 3.98 1951 11 11 46*1 ’ 4.09 1953 11 11 74.7

Fine Halfbred, 56/58’s— d. ft Super .. .. .. 73 to 78 Good .. .. 68 to 72 Average .. Halfbred, 50/56’s— 64 to 68 Super .. .. M 65 to 69 Good • .. .. ., 63 to 66 Average .. . 60 to 64 Fine Crossbreds, 48/50’s— Super .. .. .. 61 to 63 Good .. .. 59 to 61 Average 56 to 58 Medium Crossbred, 46/48’s— Super .. .. x . 60 to 62 Good .. 58 to 60 Average 55 to 57 First Crossbred Pieces. 48/50’s— Super .. x .. 47 to 50 Good 45 to 48 Average 43 to 46 Crossbred Bellies, «/50"s— Good 44 to 46 Average 42 to 44