AUCKLAND STOCK EXCHANGE

Evening Star, Issue 22383, 6 July 1936, Page 7

AUCKLAND STOCK EXCHANGE

/ , RENEWED INTEREST IN AUSTRALIAN SCRIP [Special to the ' Star.’] AUCKLAND, July 4. Following a quiet spell, operations on the Auckland Stock Exchange livened up again, and during the week which closed last night a big volume of business was recorded. This was largely due to renewed activity in miscellaneous Australian stocks, which again accounted for a large share of the business. Though New Zealand industrials are by no means neglected, there is no gainsaying the fact that very substantial sums of money which should be profitably invested in the Dominion are finding their way to the Commonwealth. The intimate connection of the Stock Exchange operations with economic development is not always appreciated. Investors are chiefly concerned in the fluctuation of the scrip they have purchased, and with the dividend it carries, with the general public more or less passive spectators; yet it is an undeniable fact that the Stock Exchange market provides a definite and useful indicator to the directors of a company as to whether they can make a confident appeal to the

public for additional funds with which to extend their operations. If their shares are selling well above par, it can be accepted as almost certain that a reasonable addition _in the way of fresh share capital will be promptly taken up.' If, on the other hand, the scrip is valued below par, then an application to the public for fresh share money is likely to be coldly received, unless the issue is accompanied by some special provisions in the form of preference. In the last analysis, therefore, every purchaser of a share helps to strengthen the financial structure of the security represented. Whether such additional capital can be profitably employed is, of course, another matter. Amongst “ best sellers,” Broken Hills again occupied a leading position, and on a rising market sold steadily from 72s 6d to 75s 3d._ The Commonwealth’s most successful industrials, Australian Glass, had a good week. The shares sold from £4 9s 3d to £4 11s. Colonial Sugars, which had been steady and rather quiet for some time, ‘ took a move at the end of the week, with sales from £42 to £43_ss. Chain store issues again received special attention, Coles leading off with further sharp rises. Goldsbrough, Morts continue to weaken, and although holders reduced their reserves to 30s 6d, they failed to attract an offer from buyers, who are_ obviously nervous over the wool position. The quietness in the banking section was partially relieved by interest in the shares of the Bank of New Zealand, which continued the weakness that has existed since the annual meeting. In tire early part of the week the scrip was on offer at all Dominion exchanges at unsually low figures, and locally the shares sold down.to £2, the lowest figure accepted for many a long day. It was obvious that investors had taken very seriously the warning issued by Sir George Elliot, chairman of directors, in regard to the possible reactions towards the bank of the Government’s financial policy. However, at 40s came the inevitable swing back, and later sales were at 41s and 41s 9d, after which holders raised their reserves to 42s 6d.

In regard to Australian issues, there was little of special interest, though New South Wales improved its position with buyers up to £32 15s and no sellers. The announcement of a dividend rate unchanged for the year by the directors of the Commercial Bank had no noticeable effect on the market.

Insurances commenced the week with a firm front, and all round advances were recorded, but' they failed to hold, and an easier tendency was noted towards the close of the week. New Zealands sold up to £3 6s, and South British to 93s 3d, but later sales were at 60s and 92s 6d respectively. Nationals made fresh gains, with business at 18s 9d, and Queensland gained Is 6d a sale at 61s 6d. Government stocks were again comparatively quiet. There were regular buyers for all issues, but they _ were not prepared to advance on late limits, and with holders obviously not anxious to sell, little business was put through. The few sales put through showed little variation from recent quotations. The mining section was again comparatively quiet. A feature of the business was a sale of Marthas at 18s, a drop of Is 4d since the 10th of last month. Sales of New Zealand miscellaneous issues did not cover as large a field as usual, but the market was quite steady, and, except in a few isolated cases, there was no weakness reflected in the sales list.