Brokers still bullish

Press, 3 August 1985, Page 22

Brokers still bullish

New Zealand institutions are back in the sharemarket but buying very selectively, said Mr Derek Satterthwaite of J. S. Satterthwaite and Co., Timaru sharebroker. Australians are showing an increased interest as they have had a very firm local market, in spite of gyrations by Wall Street during the week. The price of gold has stood up well for most of the week, which has benefited the Australian mining stocks, he said.

“All this rubbed off on the New Zealand sharemarket. Australian investors are beginning to look at some of our shares they previously ignored, such as New Zealand Salmon.

“We are impressed with the performance of Apex, which is riding high now that the CFM take-over is out of the way, and with R and W Hellaby looking much better. “With the market in its present mood there is little chance of share prices falling,” Mr Satterthwaite said. Mr M. N. Daniel, of the Auckland broking firm Morrow and Benjamin, said that the market was bubbling along nicely on big volume, with a lot of interest from Australia, the U.K., and the East. Even the New Zealand institutions are back in the sharemarket, he said. “Something appears to be on the go with CPD again: this company remaining quite vulnerable,” Mr Daniel said.

The market is likely to remain quite firm next week, he said.

Mr Brian Kreft, of Forsyth, Barr and Co., Dunedin sharebroker, said that after being tested earlier in the week the market finned and advanced on good turnover.

“The check in the market’s advance earlier apKto have mirrored perinces of overseas markets; this pattern, although relatively new to the New Zealand market, has occurred for quite some considerable time in Australia,” he said.

“Institutions have been active in the market this week and have under-pinned the strength of the market even further. In tjie short term the wild card will continue to be the strength of the New Zealand dollar; should our dollar strengthen to a marked degree then overseas investors will be prone to take the profit as the downside risk increases.”

The “blue-chip” stocks such as Brierleys, Progressive and Goodmans, have advanced markedly in the last two days and continue to out-perform the market average. The high-flyers, such as Pacer and National Bloodstock now appear to be meeting buyer resistence at these levels.

“Charter Corporation, after firming last week was detrimentally affected by the poor performance of Fleur. The future performance of this stock is now somewhat dependent upon the performances of its strategic investments, particularly ‘Big Apple’. Should the sceptisism concerning Big Apple’s performance be removed in the near future, then Charter should advance,” he said.

“The highlight of the week, in my view, must be the performance of the newly-listed, little-known, Anzon investments. This company listed with an issued and paid-up capital of 8 million shares, of which I understand 70 per cent is under the control of the four directors, including Messrs Reynold and Francis of Chase Corporation. For no other reason than that the scrip is tight, the share price can be expected to run from these levels. “I believe a combination of firming trends in overseas markets, the relative stability of the New Zealand dollar and the under-pinning of the market by institutional investment should result in equity prices continuing to advance through the coming week,” Mr Kreft said.