Shares remain depressed

Press, 3 December 1987, Page 31

Shares remain depressed

Further weakness of the United States dollar, and nervousness on world financial and share markets, carried over into the New Zealand sharemarket yesterday and caused a further decline in fairly active trading. The market held up fairly well in the morning, perhaps on the promise of an announcement of a large gold find, but when this did not eventuate sellers came forward in the afternoon and drove prices down. The Barclays index of 40 industrial shares fell a further 34.54 to 2052.85 — moving closer to the psychologically important 2000 mark — while the NZSE capital index dropped 12.69 points to 729.88. There were five falls for every two rises, as 17.2 million shares crossed for $14.7 million — an average of 86c a share. Judge Corporation was the volume leader, and Prodigal, a West Coast gold miner, was second with 1.9 million shares traded, all in one parcel. The price was unchanged at 9c.

Euronational, 55c down to 30, Inter Pacific, 50c

lower at 100, and EuroPaclfic 50c cheaper at 650, showed the largest falls. Richmond dropped 45c to 95, and 25c falls were chalked up by Salmond Smith Biolab at 130, and Energycorp at 285.

Wilson and Horton fell 15c to 440, and 10c falls were posted by TozerKM at 150, and Big Glory at 70.

In spite of the rising gold price apd rumours of large gold finds New Zealand gold miners were lower on balance, with Kiwi Gold down 15c to 60, and Mineral Resources 12c to 88.

Elsewhere, price falls were but widespread. Brierley fell 6c to 206, as did Goodman Fielder to 342, while Fletchers lost 4c to 420.

Mr Kerry Porter, of the South Island sharebroking firm Forsyth Barr, Ltd, said that after a lacklustre performance on world bourses the New Zealand sharemarket opened quietly yesterday morning, with prices trading in a narrow range.

In the afternoon selling pressure intensified, and a number of leading stocks were sold down 10 to 15 cents, he said.

“Companies associated with Mr Bruce Judge again feature on our market. Speculators purchased 1.6 million Judge Corp shares, driving the price up 100 per cent, on suggestions that a rescue package may have been negotiated. “Euro-national’s share price fell by two-thirds after news that the company was likely to incur a substantial loss as a result of non-payment of an amount of $9O million owing by Judge Corporation. This was to be the final payment for the purchase of 47 per cent of Kupe Group earlier in the year. “The falling U.S. dollar continued to fuel concern on world ■'. financial markets. This has the effect of making European exports less competitive in the U.S., and adds to inflationary expectations. “These markets . are now awaiting an announcement from West Germany, expected today (N.Z. time), as to whether that country’s central bank will cut its discount rate half a percentage point. It is possible, however, that the anticipation of this announcement may be greater than the news itself,” Mr Porter said.