Market moves up: Brierley tops 400

Press, 14 July 1987, Page 24

Market moves up: Brierley tops 400

By

NEILL BIRSS

The sharemarket firmed again yesterday, stimulating optimism that it is returning to a bull run. The Barclays index jumped 18.89 points to top 3200. More important, Brierley Investments was back above 400 c for the first time since the end of April. It jumped 9c yesterday, and is 31c up since the beginning of the month. Market watchers have been looking at the Brierley’s approach to 400 c as a buoy in the share race. Other favourable omens for the market are: • The increasing bullishness of the share futures market. • The continuing fall in interest rates. The Barclays industrial index has risen more than 186 points this month, and now seems well clear of the 3000 mark. The Stock Exchange gross and capital indices also rose yesterday: the gross by 6.19 points, and capital by 5.41. Chase was up 23c at 362, its highest since the second week of May. Goodman Fielder was up 17c at 506. It has risen 63c, or 14.2 per cent, in July. Robt Jones Investments firmed 8c to 213. Jones has risen 21c since July 1 and 70c

since the beginning of the third week of May. Pacer Pacific, the investment and standardbred company, finned 20c to 1110. The issue is up 50c, or 5.7 per cent, for the month. N.Z. Forest Products was up 9c at 431 and Equiticorp was up 16c at 368. European Pacific rose 200 c to 2100, a 10.5 per cent jump. It is up 100 c, or 5 per cent for the month. Judge Corporation bounced back 8c to 460, its level of July 1, after its steep slide from 705 c in the second week of April. Among other Christchurchbased shares, Mount Cook was up 10c at 265, compared with 250 on July 1. Firestone firmed 15c to 285. It has risen 85c, or 41 per cent since July 1. PDL Industries and Lasercorp Holdings rose 5c and 1c respectively after favourable profit reports on Friday. Lasercorp has been fairly steady at 51 or 50 over the last three months. But PDL has put an almost 100 c, or more than 50 per cent since April. Against the trend, Fletcher Challenge eased 2c to 563. Among the others to fall were the troubled Strathmore Holdings, which eased another 2c to 30. N.Z. Marine Farms was untraded after Friday’s agreement by shareholders to the rescue operation by Como Holdings. It last traded at 30c on Thursday, compared with 160 c at the beginning of the year. Radio Pacific, whose result

announced yesterday was down 3 per cent, was also untraded, but last week it fell 40c to 300. Carter Holt Harvey was ex bonus its 1:4 issue and its dividend yesterday. On the corrected theoretical price of 399 c it was up 6c at 405. Broker comment The firm trend of last week continued yesterday with prices continuing to strengthen, said Mr John Hutchinson, of the Christchurch broker, Anderson Reid and Company. Prices jumped sharply in the afternoon session in response to a firm Australian market, but some sellers emerged and most stocks closed off their highs. Increased interest in investment stocks was evident with Judge Corporation standing out in particular, Mr Hutchinson said. Mr Guy Spooner, of Harkness and Company, of Christchurch, said the sharemarket yesterday continued its firm trend. Brierley Investments’ breaking of the "all important psychological 400-point barrier” in early-afternoon trading, reaching a high of 405 c, was confirmation of a continuing bull trend, Mr Spooner said. “Although we do not discount a profit take over the next few days, the bullish feeling among both brokers and investors will result in further gains in share prices over the medium term.” The Barclays mining index

was up 1.03 points at 235.74. This is a rise of 2.12 points for the month, or 0.9 per cent since July 1. However, Mineral Resources, which holds 27.8 per cent of the Waihi Gold Company, expected to be producing gold and silver in 12 months, was down 3c at 130. The move reflects a slight easing in gold prices over the last week. Mineral Resources options are at 80c, compared with 30c in January. Futures Futures traders are increasingly optimistic about the sharemarket. A premium is opening out on the physical share index, and futures traders long on this contract (with positions that make profits when the market rises) have made good profits. September share index futures rose 40 points, or SBOO a contract from the Friday close to yesterday’s close, when they were at a premium of 2.4 per cent to the physical Barclays index. This futures contract has risen 262 points, or $5240 a contract, since the beginning of the month, when it was at a premium of only 0.07 per cent in the physical. Those long since July 1 have made about 262 per cent on their investment in nine trading days, or 13 days over all: an annualised return of 7356 per cent. National sales and futures — page 27