A MICAWBER ATTITUDE

Evening Post, Volume CXXV, Issue 84, 9 April 1938, Page 13

A MICAWBER ATTITUDE

ON STOCK EXCHANGE

SLOW BUSINESS

INVESTORS WAIT AND SEE

"Evening Post," April 9,

Business on the Stock Exchanges of Australia and New Zealand this week has been slow, and as the week closes it has not improved in volume or in the value of shares. Investors are "waiting for something to turn up," but not quite in the same hopeful spirit as that of Mr. Micawber of ever, blessed memory. Fear rather than hope seems to be their feeling as expressed in indifference to the attractions even of those investments that are usually described as "leaders" in the market. Last week the unsettled state of international affairs, combined with shocks emanating from Wall Street, had a deterrent effect on the minds of those with money to invest and having less regard for return in dividends than for safety of principal; this week the approach of Easter ( when all markets are usually quiet) and the trend of domestic affairs in both Australia and New Zealand are exerting some slight depressing influence on the share markets. In Australia, the prices of bank shares continue at a low level, the reasons for which are obscure. True, the big conversion loan of 1938 has to be dealt with, and of the £72,000,000 odd of this coming conversion the banks may be expected to take up some portion, thus entrenching upon their funds available for trading and similar purposes. The Commonwealth Bank in its March Statistical Bulletin drew attention to the maintenance of the inflow of imports, which, if it continues as it is, will amount to £ 140,000,000 for the year (ending June 30), compared with £113,500,000 for 1936-37. On the other side, export prices are weaker, and the index (1927 equalling 100) fell on March 17 last to 74.9, compared with, an average of 75.4 for February of this year. The value of exports for 1937-38—for all that wool and wheat prices are down—it is estimated, should be about the same as" last year, which amounted to £159,000,000. The New Zealand trade returns for January and February combined indicate a fall in the value of exports by £1,500,000, but a rise in imports for the period of £1,600,000 when comparison is made with January and February of 1937. But these returns are for two months only. When values are quoted they are in Australian or New Zealand currency, as the case may be. DOMESTIC AFFAIRS. In New Zealand uncertainty in the minds of investors seems less attributable to tne courses of external affairs than to those of our own. The prospect of still heavier taxation for social services and the General Election in November next (remote as it may seem) have unquestionably had some bearing on the market for New Zealand shares. How much so it would be difficult to estimate, and besides, the week before the Easter vacation is not the best period of the year in which to form such an estimate. Increased costs of production undoubtedly have had a depressing effect on the values of shares in many local industries requiring to employ labour on any considerable scale. The volume of business done in New Zealand industrial shares a year ago shows a considerable reduction todayThe figures which are given below are for the numbers of sales of shares in New Zealand enterprises, but they include in the "pastorals" the shares of two companies operating in both Australia and New Zealand. Otherwise the companies referred to are domiciled in New Zealand and have no working interests outside the Dominion. The companies taken for the purpose include retail stores, almost all confined .to "chain" business. "Various" includes shares in New Zealand companies (not Colonial Sugar) which are essentially of a processing or manufacturing description. The sales of shares for the month of March only are compiled from information sup"plied by the Stock Exchanges of the Dominion to the New Zealand Press, day by day. The business done during the month

of March this year and last was as follows: — Mnrch,l93B. March, 1937. Company. No. of sales. No. of sales. Coal T 23 Gas IT" 12 Pastoral 2 21 I'reezlng 8 ' 24 Textiles ."3 15 Timber 7 18 Stores 54 ' 32 Breweries 28 47 Various 37 83 Sales 103 277 March, 1937, was a week short, business closing in the last week of that month for the Easter holidays. Attention is drawn to the sales of gas and stores shares during last month. These, it should be explained, will be mainly Auckland Gas Company's shares, now selling at par. The shares in a particular chain, store with registered offices in New Zealand also predominated in last month's business shown under, "stores." GOVERNMENT LOANS. Holders of Government debentures were more inclined to do business this week than they have been for some time past. Prices for long-dated loans were a little better on the week but all loans excepting the 3 per cent. 1941 and 3| per cent. 1957 were well above par. There were sellers of 3' per cent. (1941) at £102. The position occupied by Government loans in the market a year ago, last week, and this week are shown in the following table:— Per April 29, March 31, April 8, cent. Year. 1937. 1938. 1!)38. £ £ £ 3 .. 1911 — OS , 97% 3y 2 .. 1957 9D 98% 98 >/ 2 SVt .. 1938-52 102% 103% 103% 31/ i.. 1939-52 102% "103 f103% 3& ■.. 1943 1007 8 100 100\& 4 .. 1946 103 102% 102% 4 .. 1949 103 104% 104% 4 .. 1955 104% 104% 104Va . 'Buyers. fSellers. Half-yearly interest on the. 3 J ' p.c. Stock, 1938-52, is due on May 15, and half-yearly interest on the 4 p.c. Stock (1949) is due on April 15. The sales reported this week throughout the Dominion of Government Stocks and Bonds were as follows:— 3J per cent. (1939-41), £98, £97 15s; 3J per cent. Bonds (1953-57), £98 12s 6d, £98 10s, and Stock, £98, 10s; 3h per cent. Stock (1941-43), £100 2s 6d; 3J per cent (1939-43), £100 2s 6d; 3. per cent. (1938-52), £103 7s 6d; 4 per cent. Stock (1946), £102 7s 6d, £102 ss; 4 per cent. Stock (1949), £104 10s, £104 7s 6d; 4 per cent. Stock (1955), £104 10s. Sales of local authorities' debentures, all at 4J per cent., as reported were as follows:—Auckland Harbour (1949), £105 10s, and (1943) £103 ss; Auckland City (1944), £103 ss; Mount Albert Borough (1968), £105; Takapuna Borough (1958), £103 17s 6d. Company debentures were in but moderate demand with inquiries for 6 per cent. (1944) Amalgamated Brick (Auckland) at £90 and sales of the same company's Wellington issue at £90. The debentures of N.Z. Farm3rs' Co-od.. Christchurch. 4£ per cent. (1950) had business at £96. BANKS, INSURANCE, FINANCE. Prices paid for Bank or New Zealand shares advanced this week to 43s 7d, i rise of 5d on the week, probably in anticipation of the final dividend, which may be the same as last year, when a total of 10 per cent, per annum was paid in June. Union Banks, which have been slow in moving, rose from Dusiness done at £8 11s 9d to £8 15s. 3ank of New South Wales shares were cheaper with business done at £31 17s Jd for shares on the Sydney register, Dut £32 was the New Zealand price, at which sales were effected. Bank of \ustralasia, after ;he dividend had Deen paid, dropped from £10 to £9 12s id, closing at £9 13s. Commercial 3ank of Australia shares improved :rom 16s to 16s 4d, but subsequently 6s was accepted. The preference ihares sold at £9 9s 7d. KS. and A. 3ank were dealt in at £5. Commer:ial Bank of Sydney were to be- bought or £20 15s. but this quotation failed o attract bids. Nationals of New Zeaand continued to improve from 54s id last week to 555. Shares of Naional Bank of Australasia, £5 paid, vere quoted by sellers at £6 18s to £6 9s, but buyers appeared to be out of he market. Insurance shares were easy with ales of New Zealand Insurance at 59s id, as last week. South British /hich changed hands last week at 465, old at 44s 9d this week. Nationals fere in demand at 17s to 17s 7d, with o sellers. Queenslands were in the narket at 525, but failed to interest nvestors at that figure.

Stock and station companies' share: call for little comment, beyond re marking sales of New Zealand Loar and Mercantile (ord.), at £39 15s anc Dalgetys at £8 7s ad. A slight improvement was noticed in Goldsbrougr Morts. Financial companies' shares were not in strong demand, but buyers offered £5 2s 6d for Wellington Trusi Loan shares with no response frorr holders. For Wellington Investment Trust, and Agency shares and those of the New Zealand Investment T. and A. Co., 8s 9d was bid in each instance but there were no sellers. AUSTRALIAN METALS. Business in metal shares this week was only fair with sales of Broken Hill South at from 30s 3d up to 31s 6d, and then a recession to 30s and again an advance to business up to 30s 2d Mount Lyell and North Broken Hill shares followed much the same line, the former rising from 27s 4d to 295, and slipping back to 27s 3d. Electrolytic Zinc, however, made steady improvement from 39s 3d to 40s 6d, closing at 40s. Mount Morgans kept around 9s 4d. Broken Hill Proprietary shares sold at between 59s 3d and 60s 3d, up to the middle of the week, but declined to business at 58s 9d. RETAIL STORES. Turnover in this section was generally moderate with not much change one way or the other; but G. J. Coles lifted from 78s 4d to 80s 6d and closed at 79s 3d. Woolworths, Ltd., moved between 21s 3d and 21s lid, easing to 21s 9d. Woolworths (N.Z.), rose from 21s 4d to 21s 7d, and receded to 21s 3d. VTcKenzie's Department Stores had business at 69s 6d, as last week. An improved demand set in for Farmers' Trading, the big Auckland store,-the ordinary shares selling up to 20s 4d and 21s 6d was paid for the B preference issue. INDUSTRIAL AND VARIOUS. Gas shares were dealt in rather more than usual this week and among, the sellers were not only those holding shares in the big companies, but also in smaller concerns, including Gisborna and Pahiatua. Gas shares generally appeared to be on a dull market. The position today and a year ago is shown as follows:— April 10, April 8. 1937. 1938. £ s. d. & g. d. Auckland ...... 12 0 10 0 Wellington S 1 17 6 1 16 6 Chrlstchurcb .... 196 B 1 7 6 B—Buyer. S—Seller. Coal shares attracted but little notice, but there were sales of Westport at 22s IOJd, Kaitangatas at 295, and Pukemiros at 17s 9d. Brewery shares weakened and those of New Zealand Breweries, Ltd., dropped from business at 45s to 43s 3d, brightening up thereafter to 43s 9d. Dunedins (cum div.) had inquiry at 30s, with sellers quoting 395. Queensland were in request at 22s and Tooths at 53s 3d. Carltons changed hands at 64s IOJd. Wellington Woollens (ord.) sold at £5 15s and appeared to be the only business done in textile shares this week. Freezing companies' shares were neglected, except for three sales of New Zealand Refrigerating Company, and there was an inquiry for Gears at 16s 3d. Colonial Sugars held at around £47. Wilson's Cement sold at 17s 6d. New Zealand gold mining and dredging had no business beyond Marthas at 14s 6d and Gillespie's Beach at 9d.