‘BSI in equilibrium’

Press, 27 April 1989, Page 42

‘BSI in equilibrium’

The market in the Barclays share price index futures contract opened yesterday close to where it closed on Monday night, said Dr Brent Layton, of Egden Wignall and Company Futures. “Opening at 1988 it traded in a narrow range, between a low of 1985 and a high of 2000," he said. “But it tended towards the lower end as Goodman Fielder Wattie came off its high and the Australian market began to weaken.

"Over all, trading was lack lustre. Not many people are buying the contract, as Goodman shares appear fairly priced. On the other hand not many people are prepared to sell, as they expect institutional buying from the proceeds of their Goodman sales,” Dr Layton said. “The institutions will be selling, because the offer price has been pitched just right. As one institu,-

tion’s investment manager put it: ‘Goodman is history’. “As a result, the market for the Barclays index contract is in classical equilibrium, with buyers as well as sellers content with the price, and neither wanting to move. "In spite of comments by the Prime Minister, Mr Lange, on the low rate of inflation in this country, interest rates futures and bank bills ended almost exactly where they

started from. “The New Zealand dollar was fairly firm, especially against the Australian dollar, but again it was hardly a major day. “Snoozing is the order of the day in the money markets," Dr Layton said. On the Sydney Futures Exchange yesterday the June share price index contract was down 7.0 points from its opening to 1478. It closed on Monday at 1487. A total of 516 lots was dealt.