SHAREMARKET Bearish mood continues in dullish trading

Press, 14 March 1987, Page 25

SHAREMARKET Bearish mood continues in dullish trading

By

Adrian Brokking

The New Zealand sharemarket continued in a bearish mood this week, with prices falling about 1.5 per cent in very quiet trading. Yesterday at noon was the low point, as the NZSE capital index, which covers all listed issues, stood at 1157.92 — down 2.2 per cent. However, yesterday afternoon the market staged what seems to become its customary Friday afternoon rally, and all indices closed higher than on Thursday. The NZSE capital index closed 17.62 points, or 1.5 per cent, lower than the previous Friday, at 1166.79; Barclays’ index of 40 industrials closed 50.02 points or 1.5 per cent down at 3218.55; the

Reserve Bank index dropped 1.3 per cent.

In spite of the afternoon turnaround rises and falls were practically in balance.

Volume was very low; if the parcels crossed because of the three market stands are excluded, the daily average was barely 7 million shares. It looks as if it takes very little to make the market jump in either direction. Also, there seems to be fairly strong resistance at the 3200 level on Barclays’ index. Among the shares with the most weight on the indices there were some sizeable falls.

Brierley Investments shares lost 19c on the week to 411, after being down 30c at one stage;

this in spite of the company’s excellent profit report on Monday. This once again shows up one of the market’s inconsistencies — that expectation is often better than the fulfilment. Shares are bid up in anticipation of good news, but when the good news eventuates, the share will often be marked down, even if the news is better than expected. Oil exploration shares often go “through the roof” when a well is spudded in, but when oil is actually found they can fall just as sharply.

As our American friends say in their picturesque speech: “you buy on the cannons, and you sell on the trumpets.” - Chase Corporation fin-

ished the week 25c down at 525 after being as low as 515 on Friday morning. Capital Markets lost 38c during the week after recovering 15c yesterday. Judge Corporation was marked down 40c to 755 — its low for the week.

NZI Corp shares, being kicked like a football to and fro with Brierleys finishing up with 31.5 per cent, dropped 6c to 213 after having been as low as 205.

At one stage Equiticorp was down 21c on the week, but the shares closed at 380 for a net loss of 13c. NZ Forest Products’ low for the week was 390 c, but the shares recovered to 395 for a loss of 5c on the week.