Commerce, Mining, Finance

Evening Star, Issue 22893, 26 February 1938, Page 12

Commerce, Mining, Finance

REVIEW OF THE WEEK

INTERNATIONAL FACTORS MARKETS SEESAW TURNOVER HIGHEST THIS YEAR What is an “investor”? The Oxfor Dictionary dismisses the n orh briefly with the definition of one who invests.” But the present-day stock market operator requires more than just the ability and inclination to invest. He must be a keen student of international affairs, of graphs, market trends, psychology, quotas, and lestrictions, and innumerable other tac tors influencing the course of share prices. The possession of that knowledge is but a sign of the times. To-day’s share market in general reflects the sensitive condition of the temper of investors to the unsettl«i state of affairs abroad. With hostilities ” in the Far hast (which alone is sufficient cause for apprehension without the addition of the attitude shown lately by the Japanese toward British and European business _ and financial interests in Shanghai), international strife in Spain, trouble in Austria, political differences _ in India, a severe business recession in America a chronicler could, continue citing causes for the almost daily shock to the nerves investors the world oyer are experiencing. Even Great Britain has not escaped from the unsettled turmoil, the Cabinet crisis providing its contnall these factors contributing to unsettled markets, is it any wonder that .the average investor remains perplexed and uncertain? He is willing to swim with the tide t whichever way dt turns: and once again this was illustrated during the week that finished last night. First came the disquieting news of Hitler’s latest coup, then the British Cabinet crisis, combined with a fall in the base metals market. Aew Zealand markets responded to the news by turning uncertain. _ W all Street provided; a surprise and held firm, transmitting its brightness across the Atlantic, and London improved, base metals advancing'to recover all their lost ground. Prices were marked up to well above Opening rates, but the overseas centres failed to hold their gains, and at the close values were again taking, the downward path. Turnover on the local Exchange was fractionally better than that recorded in the previous period, and was the highest this year. A feature of the Week was the wide margins quoted by vendors for transtasman issues, which, as usual, captured more than half of the business. Midweek quotations showed margins of more than Is for popular issues, .while in numerous cases holders did not tome forward. _lt, was yet another variation of an increasingly popular policy —“ Wait and see.” Banking shares, showed little variation on last week’s values, but insurances revealed a perceptible firming. Slightly better attention was paid to the coal section j where the best sales list for some time was recorded. Commonwealth industrials moved in accord with London and Now York and dosed well upon recent rates, but the easier trend that introduced the weakening tendency in Australian mining stocks Was also reflected in this section. WHAT OF THE FUTURE. Qualified London, operators forecast a spring revival in the share market. The United States holds the key to recovery, as was indicated in a London cablegram which stated that “ while those viewing the situation realistically do not disguise the fact that during -the next 12 months Europe will probably offer more bear than full points, this may easily be offset by favourable developments in America.” None will contradict the statement that America is at present in the throes of a serious business depression, but whether Britain is now entering the_ beginning of a business recession gives ground for argument. “ Where there’s smoke there’s fireand it is of interest to note that the ‘ Daily Telegraph ’ earlier this month published an “anti-slump” supplement. Steel production and company results continue excellent, hut the market turns a blind eye to all bullish considerations and prefers to concentrate on bearish developments. WALL STREET IMPROVEMENT. Since the inauguration of the new rule, aiming at preventing speculative short selling on Wall Street, the Dow Jones index figures show an improvement. This rule, which was made by the Securities Exchange Commission, provides that short sales of any security must he effected at a figure eight points above the preceding sale price. A short sale is one in which a seller does not own „ a security. The rule, it is • hoped, will end “ bear ” raiding by exchange members and large outside operators. A “ SAFETY-FIRST” POLICY. • Only occasionally does the speculative element appear on Dominion markets these days, the majority of shareholders preferring to watch the fortunes of others and “ wait-and-see.” The demand for Government loans continues good, and three parcels changed hands early in the week. Sellers quoted for four or five issues,

but failed to attract a response. Buyers continued a consistent demand for other issues, however, and advanced their limits 5s for the ’3B-52’s, and 4 per cent. 1943-46 and 1916-49 Bonds. ERRATIC METALS MARKET. Base metals passed another erratic period. Brices moved sharply day by day, but values averaged better rates than last week. An easier tone appeared at the close, however, with its consequent reflection on transtasman related stocks. A comparison of the average prices follows: — . Closing

Tiie rise of £5 in the a vein go price of tin can, in part, be attributed to the action of the International Committee in reducing the quota to 55 per cent. The cut was rather more than was expected, forecasts foreshadowing a reduction of 10 per cent., but that which the committee adopted was one of 15 per cent. The reduction reflects the weak conditions ruling in the United States, the chief consuming country, and the expanding stocks. The rise in spelter indicates that the market is taking no notice of the revival of the old rumour of the formation of an international zinc cartel. It is possible, however, that the current low price will encourage mines to withhold concentrates from tho market. The 1 Financial News ’ points out that zinc production to-day is hardly worth while. It is doubtful if the mines are receiving a gross return of more than £SO a ton, from which freight, insurance, and other costs must be deducted, MARKET NOTES. Bank of Now South Wales were quoted ex div. 6s a share on Ihursday, prices readjusting themselves to between £3l 10s and £32 10s. National Insurances were marked up Id to business at 17s Id, dosing firm. Standards, cum div. Is 3d, had a best buyer at £2 19s 9d, but holders, even at that price, were not attracted. Howard Smiths did not appear on the call sheet, operators awaiting the final dividend announcement, which shows an increase of 1J per cent. Westport Coals came in for improved attention, business ranging between £1 3s 7d and £J. 3s 3d. Broken Hill Proprietaries failed to reach the sales list, vendors maintaining wide margins. G. J. Coles were marked up 3s to business at £4 Is, buyers later advancing to 9d above that price. Woolworths (Sydney) produced the speculative element of the week. From opening business at £1 5s lOd they moved up to a top sale in Dunedin at £1 Bs, a Wellington transaction being recorded Is 6d above that_ price.' Market rumours of some additional benefits to shareholders were fully justified with a final dividend of 9 per cent, (making 17 per cent, for the year), and a bonus distribution of one for five. Prices slipped later, however, the stock selling at £1 6s 9d. Woolworth’s Holdings (South Africa), which holds a virtual monopoly of the unlisted section, changed hands at 14s lid during the week. Austral New Zealand Mining had its first quotation for the year yesterday, when a seller offered the 15s-paid shares at 18s. Buyers were not interested. Mount Morgans shared in the general advance by Australian mining stocks on recorded sales improving almost Is. Mi- E. Campbell, chairman of directors, at the recent extraordinary meeting, announced that dividends would be resumed soon after the shipment of accumulated concentrates had begun. Taranaki Oils again camo under the spotlight, moving up to business at 6s lid. A steadily falling market saw the shares recede to final dealings 5d below that price. TREND OF THE MARKET. Fluctuations in the values of various securities are indicated in the following table:— BANKS.

*Ex div. t Cum div. J Sellers. LATEST SALES. Sales since the last review have been as follow; New Zealand Government Loans.—3J per cent. Stock, November, 1938-52, £lO3 (2); 4 per cent. Bonds, 1943-46, £lO2 10s. Banking,—New South Wales, £32 2s 6d; New Zealand, £2 3s; Commercial, 16s 7d. Insurance.—National, 17s Id. Shipping.—Northern Steamship, 4s. Meat Preserving.—New Zealand Refrigerating (paid), 18s fid. Loan and Agency.—New Zealand

HEW YORK SHARE INDEX

CANTERBURY MARKETS FEW LARGE ORDERS [Paa Unites Pkbss Association.] CHRISTCHURCH' February 25. There has been a steady trade in small seeds with the North Island, but few big orders are in the market. Wheat deliveries continue heavy and cocksfoot is offering freely, otherwise the markets are quiet. The wheat harvest, assisted by excellent weather with very few breaks and with the increased- use of mechanical means, proceeded more rapidly than usual. This week there has been a distinct slackening off in the amounts delivered as the main part of the early harvest has been completed. All wheat offering is of good quality, and this week fewer samples with a high moisture content have been received. Cocksfoot has been offered very freely this week. The market remains steady at 8d to 9Jd for this season's perennial ryegrass, which is extremely scarce, little having offered. There is a fair demand for the seed, and the price remains firm. A.few samples of white clover were received, but the harvest of this crop is not yet general. Some early offerings show a dark colour, but it is reported that the crop is generally good. The crop is not expected to be a large one, but there were fair stocks carried over last season. The price at present is 8d to 9d per lb. Apart from the reports of blight, which are discussed freely, thero is little interest in potatoes forward. The market was exceptionally quiet. Blight has been reported in practically every district in Canterbury, but, so far, the trouble appears to be considerably less serious than some reports would indicate. So far, the disease is little more serious than in a good year, but it is not likely as yet to affect the yields very materially.

WHEAT AND FLOUR NEW REGULATIONS [Per United Press Associatiok.J WELLINGTON, February 25. Under tho Board of Trade (wheat and flour) regulations, 1938, issued this evening, the 1937 regulations are revoked, and the Wheat Committee to be set up is authorised to continue the administration and winding up of the wheat marketing and flour marketing schemes established in 1937. The committee to be established is to be appointed by the Minister of Industries and Commerce (Mr D. G. Sullivan). The new committee is given power to take over on behalf of the 1937-38 scheme any surplus 1936-37 wheat remaining on the hands of the previous committee. The restrictions on dealings in wheat are outlined, and the committee is required to purchase all wheat, witli specified exceptions, offered to it for sale. Tho committee is empowered to fix the price and the terms on which the wheat is sold by it. The committee is also granted power to deal in flour and to fix the sale prices for flpur of fair average qualitv.

HOWARD SMITH DIVIDEND

Press Association—By Telegraph—Copyright SYDNEY, February 25. The directors of Howard Smith Ltd recommended a dividend of 3 per cent, for the half-year, making 5 per cent, for the year.

BEET SUGAR

Press Association—By Telegraph—Copyright LONDON, February 24. Beet sugar, os 4Jd.

Guarantee Corporation, 4s 6d. Coal—Westport, £1 3s (kl (2), £1 3s 7d, £1 3s 3d (4) ; Westport-Slockton (ord.), 3s. Miscellaneous.—Colonial Sugar Company, £46 5s (2); Cox Bros., 15s; Cox Bros, (rights), 9s 2d; Dominion Fertiliser, £1 3s 6d (2) ; G. .1. Coles, £4 Is; Taranaki Oil, 6s lid (2), 6s Bd, 6s 7d, 6s 6d (3) ; Woohvorths (Sydney, ord.), £1 5s lOd (2), £1 6s lid, £1 7s (2), £1 7s 3d (6), £1 7s 2d '3), £1 Bs, £1 6s 9d (2). Breweries.—New Zealand, £2 5s 7Jd. Overseas List.—Woohvorths (South Africa), 14s lid. Overseas Mining.—Broken Hill South, £1 14s (2); Electrolytic Zinc (pref.), £2 8s; Electrolytic Zinc (ord.),'£2 6s 6d, £2 7s; Mount Lyell, £1 10s 2d (2), £1 10s Id (3), £1 10s 7d (2), £1 10s 6d, £1 11s (2), £1 11s 9d; Mount Morgan, 9s 4d, 10s 4d,' 10s 3d; North Broken Hill, £2 11s, £2 10s 6d (2). Gold Mining.—Martha, 15s 4d.

Last week. This week. Price. . £ s. d. £ s. d. £ s. d. Copper . ... 38 16 9 41 2 6 41 4 4i Lead 14 18 3 15 16 71 15 15 7i Tin 182 5 9 187 8 6 189 7 6 Spelter . ... 13 17 1 14 18 4i 15 3 9

Feb. 18. Feb. 25. £ s. d. £ s. d. New Zealand 3 3 0 2 3 0 N.S.W 32 0 Of 31 10 0* Comm. ... ... 0 17 ,o: 0 16. o: MISCELLANEOUS. B.H.P 3 1 3 3 2 4 British Tobacco 2 9 3 2 9 4 G J. Coles ... 3 18 7i 4 2 0 W’worths Ltd. 1 5 11 1 6 9 W’worths (N.Z.) 0 19 10 1 1 6 Taran.aki Oil ... 0 6 11 0 6 6 N.Z. Breweries 2 5 9 2 5 9 AUSTRALIAN MINING. B.H.S 1 12 9 1 14 6 Mount Lyell ... 1 9 10 1 11 3 Mount Morgan 0 9 1 0 9 11

DOW JONES AVERAGES Railroads . Industrial s. Turnover Feb. 25 ... 30.50 131.58 900,000 Feb. 24 ... 30.05 130.85 720,000 Feb. 23 ... 30.52 132.41 1,300,000 Feb. 21 ... 29.35 129.49 760,000 Feb. 19 ... 28.76 127.50 290,000 Feb. 18 ... 28.66 126.29 770,000 Feb. 17 ... 29.30 127.59 860,000 Feb. 16 ... 28.71 124.90 470,000 Feb. 15 ... 29.04 124.93 520,000 Feb. 14 ... 29.16 125.97 400,000 Feb. 11 ... 28.96 124.94 390,000 Feb. 10 ... 29.11 125.54 630,000 Feb. 9 ... 28.13 125.00 750,000 1938. Highest , ... 32.33 134.35 Lowest , ,.. 27.08 118,49 1937. Highest . ... 64.86 194.40 Lowest. , ... 28.91 113.64