London market at record level

Press, 7 August 1978, Page 14

London market at record level

Share prices rose in light trading on the London Stock Exchange last week, on the strength of sterling against the dollar, and speculation over the possibility of a cut in the minimum lending rate. The strong rally on Wall Street also influenced sentiment. The market seemed poised to test the 500-mark, and in fact reached a record high level of 499.9 on Thursday. But on Friday it retreated, scared of its own daring. Whatever the punters thought of dividend restraint, it became clear during the week that the big institutional battalions were happy with the prospect of dividends rising by an average of 15 per cent in the coming year.

The Government’s Bill to cut pay settlements got safely through the Commons; the “corset” is keeping bank lending in check; the outlook for the rate of inflation has

improved; and the pound has! been strengthening not only I against the United States 1 , dollar but also compared! with some of the “hard” currencies. Given this back-1 ground, and the growth in institutional liquidity that isflowing from the relatively smaller amounts of money presently going into gilts, the outlook for ordinary shares is, for the moment, promising. The Australian sector followed closely the developments in Australian home markets. Closing prices on Friday of a selection of shares were;— Ampol. 81;; A.N.Z., 284 J xr; N.S.W.. 563; 8.H.P., 730; Dalgety, 2721; Elder Smith, 207 g; Lloyds Bank, 257 J, xd; Mt Lyell, 281; Challenge, 148; Nth 8.H., 1273; Plessey, 99; R.T.Z. ord., 236 and regd 2303; B.H. Sth, 117; Trans Dev., 753; West. Mining, 1461; 8.A.T., 3223; Distillers, 198; Glaxo, 5943; LC.I., 3883; Marks, 164; P and O. 873: Prudential "A”, 165; Reed Int, 1523; Shell Transport, 5543; Unilever, 534; War Loan, 31 5/16; De Beers, 3953.