FUTURES Rates climb again

Press, 13 May 1987, Page 44

FUTURES Rates climb again

The two interest rate contracts and the Barclays share price index futures eased yesterday, as interest rates be : gan to firm.

A futures trader said that interest rates had already shown signs of rising, and the decision by the Reserve Bank to reduce the daily cash in the system from $4O million to S3OM was an additional factor in rates going up.

The Government stock (GSK) contract was down a further 10 points in June to 8380, its low for the day after moving in a narrow 15 point range. The bank accepted bills (BAB) contract for May lost 30 points and June 45 points compared with Monday, ending on, or near, their lows.

The trader said that the sharemarket dropped sharply in the afternoon as bullishness, helped by the buying of Wilson arid Horton shares, faded.

The Barclays contract closed on its low of 3135 after a tight trading range of 41 points. It was also 47 points down on Monday, and the premium was cut from 59 points to 46 points. International There had appeared to have been a change of face by commodities in the last week because of inflationary expectations in the United States, said the manager of Buttle and Company Futures Brokers, Ltd, Mr Brent Jones.

For example, early yesterday morning, New Zealand time, soya bean futures moved up 30c a bushel, or

SUSISOO, which was its limit. The buy in for the contract was only SUSI2OO. Besides inflationary expectations, there were also predictions that United States, grain crops could be lower than the bumper harvests of the last five years because of higher temperatures. In addition, there were expectations that the Soviet Union might step in early to buy grain before prices went too high. Except for the week after the Chernobyl nuclear power station disaster last year, commodities had remained stable, Mr Jones said.

The United States Department of Agriculture (USDA) said that the Soviet Union's 1987 grain crop was off to a poor start and may yield only 195 million metric tonnes, down 15M from last year. The department said the Soviet Union would have to buy about 36M tonnes of grain from the world market, up 6M tonnes from 1986 — the highest in three years. Crop problems in the Soviet Union and reduced plantings of grain in the United States, Australia, and Canada might lead to a decline in the over supply of world grain for the first time in several years, the agency said. In Sydney, the June share price index futures closed 43 points higher at 1887, a 44.3 point premium to the physical market. Details of yesterday’s trading were:

SUS CONTRACTS Mth Open H/L Last Vol May 1.7400 7400/7350 7350 32

Jun 1.7640 7640/7599 7599 29 Jly 1.7870 7870/7870 7870 4 Contracts traded: 65 ' Open positions at May 11: May 390, Jun 298, Jly 34, Sept 49, total 771 (up 111). COMMERCIAL BILLS Contracts traded: Nil Open positions at May 11: Jun 123, Sept 43, Dec 40, Mar 39, Jun 10, total 255 (same). GOVERNMENT STOCK Mth Open H/L Last Vol May 8391 391/391 391 1 Jun 8392 395/380 380 575 Contracts traded: 576 Open positions at May 11: Jun 4618, Sept 36, Dec 101, total 4755 (up 19). WOOL Mth Open H/L Last Vol Aug 679 679/679 679 1 Oct 693 693/693 693 1 Contracts traded: 2 Open positions at May 11: May 85, Aug 137, Oct 107, Dec 147, Jan 365, Mar 312, May 140, Aug 16, total 1309 (up 4). M-DAY BANK BILLS Mth Open H/L Last Vol May 7745 745/725 730 42 Jun 7920 940/905 905 95 Jly 7990 990/990 7990 10 Sep 8150 150/150 150 3 Contracts traded: 150 Open positions at May 11: May 474, Jun 717, Jly 17, Sept 337, Dec 54, Mar 63, Jun 50, Sept 50, Dec 50, Mar 10, total 1822 (up 19). SYDNEY ALL-ORDS (half-points omitted) Prev. Mth close H/L Last Vol Jun 1844 1887/58 1887 2385 Sep 1864 1899/80 1897 77 Contracts traded: 2462 Open positions at May 11: 16,026. BARCLAY’S SHARE INDEX Mth Open H/L Last Vol Jun 3175 176/135 135 568 Contracts traded: 568 Open positions at May 11: Jun 1213, Dec 82, total 1295 (up 28).