MARKET IN LONDON

Press, Volume CIV, Issue 30822, 6 August 1965, Page 15

MARKET IN LONDON

Feature Has Been Gold (Special Crspdt. N.Z.P.A.) LONDON, Aug. 5. The news has been gold on the stock market here this week. After the announcement of a £som drop in gold and convertible currency reserves, it had been thought that “some panicking” might prevail. But initial reaction was just the opposite. Indeed, share prices moved ahead strongly yesterday in spite of the gold and reserve figures. Gold shares were a notable feature in the advance and sterling also had a slightly firmer look. Observers, so far, have been inclined to look at the unexpected advance in two ways. One source says that devaluation of the pound 'is reckoned a definite possibility in the coming weeks, and leading broking and banking houses are telling their clients so. Since devaluation led inevitably to more inflation, investors were tending to put their money into the shares of industry and commerce,.in spite of the uncertain outlook for profits and dividends. Another source comments, however, that there is a feeling that since prices have stood up to the latest news, the worst may be over for some while yet. Some institutions were heartened by the present political situation.