Market mood cautious

Press, 3 August 1981, Page 20

Market mood cautious

by

ADRIAN BROKKING,

Commercial editor

The New Zealand sharemarket firmed a little last week, but prices were mixed and the prevailing mood among investors remained cautious and trading was quiet. Two floats closed during the week — Visionhire and Bendon — and both were heavily oversubscribed. This shows that there is plenty of investment money waiting in the wings even if we allow that many investors deliberately applied for more shares than they expected to get. Investors may have taken heart from the survey by the Institute of Economic Research which reported an increase in optimism among businessmen, but this may have been offset to some extent by the 1981 Business Survey from the Chambers of Commerce, which was

again very critical of the level of inflation.

Carter Holt shares put on 15c during the week, a remarkable performance in the light of the solid premium shareholders are being charged on the new cash issue. The 100 c shares are issued at 325 c on a one-for,-four basis: at the market price just before the announcement the bonus element on the old shares was 13c, with the theoretical value of the rights 52c.

The company’s performance has been excellent, of course, but the question of what will happen to the current incentives for the forest industry must cast a shadow on the immediate prospects of all firms in the industry. However, the chairmen of the companies in this indus-

try who reported last week seemed cheerful enough.

Dr O. F. Haylock, the chairman of Canterbury Timber Products, Ltd. told the annual meeting that in spite of the uncertainty caused by Mr Muldoon’s remarks, CTP expected to continue the kind of returns generated in the last two years.

The chairman of Henderson and Pollard, Ltd (Mr C. W. Pollard) said in the annual report that the company expected a profitable future in local and export markets. Goodman shares rose 20c to 475 c during the week, undoubtedly on the strength of the remark in the annual report by the managing director (Mr G. P. Shirtcliffe) that the group expects a strong increase in profitability in the current year.