Futures stay put

Press, 12 September 1987, Page 32

Futures stay put

Both Government stock (GSK) and bank-accepted bills (BAB) futures failed to break new ground yesterday, although they were higher in early trading. The lower food price index figure was welcomed by both contracts on Thursday, but yestersday the market only consolidated the gains made in the previous session. The Barclays contract ended near its lows, but up on the previous session, as it tried to breach higher resistance levels. The spread was a narrow 26 points, the index closing 10 points off its low at 3975. The premium ended at 92 points against 102 previously. The manager of Mair Astley Futures, Mr Geoff McDonnell, said that the food price index figure of minus 0.3 per cent combined with reports about inflation decreasing generated a bull run on the GSK futures index late this week. Some market participants felt that interest rates had over reacted upwards, especially as the call rate seemed to have stabilised under 20 per cent There was now a view that there was perhaps, more upside in the GSK futures. The spokesperson for Marshall Futures, Miss Jenny Chin, said that after the release of economic indicators, which proved to be bullish, stoplossing on GSK saw September futures trade to a high of 8384 from a low of 8343 early in the week. Technically, the market appeared overbought but any decline would be bought into by buyers who had missed out earlier. Downside was 8365-68 for support and resistance overhead 8393-7. BAB futures closed near its highs on fundamentals and appeared likely to continue to firm as investors looked to buy assets between 19.50 per cent and 19.75 per cent. Both interest rate contracts for September are due for settlement on Wednesday. The tax take should keep the big bulls at bay though, because tighter liquidity should stem any strong buying. On Barclays, Mr McDonnell said that Mair’s considered futures were moving into a consolidation phase and no clear direction would come until interest rates were perceived as definitely weakening. Miss Chin said that futures had run into upside resistance on old highs and volume eased mainly because of the market looking for lower buying levels on expected correction to this latest run up. “The market looks to be still in an uptrend with a slight correction possible as longs get tired of waiting.” On wool, Mr McDonnell said that although prices eased about 20c at auction this week, the futures price structure remained at a premium against physicals with market participants still expecting a weaker N.Z. dollar to boost prices later. An expected shortage of crossbred fleece could hold prices up, but the main catalyst for price changes should be the/novement of the U.S. dollar against the Kiwi. On the Kiwi dollar, Miss Chin said that the Kiwi dollar was unable to break U562.60c this week and profit taking saw a 1c fall from this level

before renewed interest had it back above US62c yesterday. “The immediate direction still looks up and with the Australian dollar still looking good downside should be limited.” On the Sydney Futures Exchange, September share price index futures jumped 29 points to 2242.0. JUS CONTRACTS Mth Open H/L Last Vol Contracts traded: Nil. Open positions at September 10: Sep 113, Oct 201, total 314 (down 201). COMMERCIAL BILLS Mth Open H/L Last Vol Contracts traded: Nil. Open positions at September 10: Sep 3, Dec 40, Mar 39, Jun 10, total 92 (down 11). GOVERNMENT STOCK Mth Open H/L Last Vol Sep 8375 384/374 376 698 Dec 8416 423/410 411 113 Contracts traded: 811. Open positions at September 10: Sep 4648, Dec 245, total 4893 (up 84). WOOL Mth Open H/L Last Vol Mar 690 690/690 690 1

May 714 714/714g 35 714 1 Contracts traded: 2. Open positions at September 10: Oct 29, Dec 94, Jun 327, Mar 354, May 247, Aug 30, Oct 1, Dec 2, total 1084 (same). W-DAY BANK BILLS Mth Open H/L Last Vol Sep 8100 125/091 105 92 Oct 8115 125/100 110 62 Nov 8135 140/120 120 II Dec 8176 176/176 176 2 Mar 8165 165/165 165 2 Contracts traded: 169. Open positions at September 10: Sep 872, Oct 330, Nov 124, Dec 275, Mar 212, Jun 152, Sep 132, Dec 137, Mar 12, Jun 12, total 2258 (down 93). SYDNEY ALL-ORDS (half-points omitted) Prev. Mth close H/L Last Vol Sep 2213 2245/32 2242 1253 Dec 2283 2315/03 2315 117 Contracts traded: 1370. Open positions at September 10: 10,328. BARCLAY’S SHARE INDEX Mth Open H/L Last Vol Sep 3975 991/965 975 290 Dec 4180 185/150 175 21 Contracts traded: 311. Open positions at September 10: Sep 1385, Dec 223, total 1608 (down 288).

N.Z. FUTURES MARKET WEEK ENDED September 9 Trading Traded prices Total Open

months SUS This week To date this week cont’s High Low Last High Low Sep ’87 1.6130 1.6130 1.6130 1.87501.6070 1 311 Oct ’87 1.6260 1.6260 1.6260 1.64001.6260 200 201 Mar '88 1.81801.7140 3 Totals 201 518 PCP Sep ’87 8500 7800 43 Dec '87 8525 7800 40 Mar ’88 8500 7800 39 Jun ’88 8430 7815 10 Totals 132 GOVERNMENT STOCK Sep ’87 8388 8343 8376 8480 8295 3265 4649 Dec ’87 8423 8395 8411 8500 8315 359 248 Totals 3624 4897 WOOL Oct ’87 638 635 635 745 530 4 29 Dec ’87 700 665 665 747 541 34 94 Jan ’88 698 675 675 750 541 17 327 Mar ’88 693 685 690 770 551 12 354 May ’88 714 712 714 780 575 14 247 Aug ’88 785 635 30 Oct . ’88 735 735 1 Dec' ’88 789 731 2 Totals 81 1084 Tenderable stock: bales. 35F2D quotes — 112/ 1/7 627 in Christchurch M-DAY BANK ACCEPTED BILLS Sep '87 8125 8015 8105 8450 7740 555 872 Oct ’87 8125 8015 8110 8250 8040 356 370 Nov ’87 8140 8050 8120 8245 8070 122 124 Dec ’87 8181 8115 8176 8350 8000 28 275 Mar ’88 8165 8165 8165 8430 8000 2 212 Jun ’88 8430 8100 152 Sep ’88 8430 8100 132 Dec ’88 8455 8100 137 Mar ’88 8400 8200 12 Jun ’88 8350 8300 12 Totals 1063 2298 BARCLAY’S SHARE INDEX Sep '87 4045 3946 3975 4045 2956 2496 1385 Dec ’87 4240 4130 4175 4240 3500 151 223 Totals 2647 1608