MORE SOBER ASPECT

Dominion, Volume 30, Issue 186, 4 May 1937, Page 9

MORE SOBER ASPECT

London Share Markets PRESS ADVISES CAUTION By Telegraph.—Press Assn.—Copyright. London, May 2. There arc signs already that the share markets will have a more sober aspect this week. Liquidation seems to have spent itself, but it would be unwise to prophesy. Thursday’s settlement is awaited with some anxiety, as heavy differences will have to be met. If the settlement passes without trouble it will open the way to a slow recovery on a broad front. Investors are already nibbling for bargains which in more normal times would be considered too good to miss. The financial Press is advising cautious purchases, stressing the attractiveness of certain industrials and forecasting a sharp recovery in rubber shares because dealers are short of stocks of the raw material. “The Economist” considers that the Chancellor of the Exchequer, Mr. Neville Chamberlain, was undoubtedly right iu emphasising that the effects of the profits tax had been exaggerated. Nevertheless, normal conditions will be impossible until the tax uncertainties have been cleared up. Present quotations of many sound shares are the result of fear rather than careful weighing of investment factors. Nevertheless there is scope for a further all-round increase in earnings of industry, as! the scale of the past four years is becoming narrower as costs arts rising and labour is restive. Opportunities for increasing profits from some developing industries still exist, but it would not be surprising if the major rise in the value of equities is a thing of the past. Commodities have suffered from heavy selling, but they have withstood it reasonably well. The “Financial News” considers that the long-term trend of commodities should be definitely upward, though from now on there will be a more selective attitude. OTTAWA AGREEMENTS Move For Revision Grows London, May 2. One result, of the present heartsearching has been to focus attention on the importance of maintaining Great Britain’s export trade. There is a growing feeling that manufacturers should not allow rearmament orders to lead industry. This attitude may cause a disequilibrium, drawing off productive activity from the export trades upon which Great Britain’s prosperity rests. The movement in favour of revision of the Ottawa Agreements is increasing. even the Government realising the importance of widening the area of world trade and lowering tariff barriers in order to encourage foreign countries to buy more British exports.