Commerce, Mining, Finance

Evening Star, Issue 23130, 2 December 1938, Page 6

Commerce, Mining, Finance

Another Fall in London Funds Hesitant Tone in New York New York remains hesitant, and after .Wednesday’s recovery dropped back again yesterday. Dow Jones industrials lost over a point, but railroads closed firm, while turnover remained below the million mark. : A sharp rise in Taranaki Oils provided the feature of investment movements this morning, the scrip rising 3s 3d, with final buyers offering 12s. Other sections were quiet, with few movements, although buying support for selected New Zealand scrip was slightly better. London funds continue to depreciate. This week’s figure of '£4,828,301 compares with last week’s £5,029,137, a decline'* of £200,836. Reserve to note and other demand liabilities stands at 32.685 per cent., as against 33.723 per cent.

INDUSTRIAL AMERICA BUSINESS SENTIMENT CONSERVATIVE REPERCUSSIONS FROM GOVERNMENT SPENDING ? INDICES SHOW HEALTHY TREND American business sentiment has not shown improvement equivalent to the rise in the business indices. Unquestionably many business men are depressed by the thin and uncertain margin of profit which they can ob-' tain, andl which is borne out by the third quarter profit reports. It is natural and correct to judge whether business is good or bad by whether it is profitable or not, for unless it is profitable there is not much induce- * ment to go ahead with new investments in plant and productive facilities, which have always represented a great proportion of the, business of the United States. Furthermore, according to the National City Bank of New York, business men fear that the rise has been due .too much to Government spending, and that it will not last longer than the spending lasts. At best they cannot see far ahead, and naturally this limits their willingness to undertake new projects or capital improve-’ ments, even if they are able. It is undeniable that Government spending has a depressing as well as stimulating effect. From this position it is but a step to the argument often made that private investment will not recover to take up. where the Government spending leaves off, and that the present rise will be chiefly in consumer goods and therefore of limited although unknown extent. If the premise of this argument is accepted the conclusion is correct. Consumer goods alone cannot carry on a forward movement indefinitely. Since, the business indices have now improved! for five months, and will likely rise again in November, to around 30 per cent, above the low point in May, it is ■ perhaps not too early to bring the point out. This has heen one of the sharpest “advances in business that the U.S.A. has ever experienced; and unless it spreads more completely into the equipment industries, including railway and utility materials, machinery and farm implements, the ultimate extent of the recovery is open to question. However, it is far from certain that the answer will be unfavourable, and practical decisions can be wrong by underestimating the outlook as well as overestimating it. The building improvement is powerful support from the capital goods side. The Government spending will not reach a peak until next spring, and with new prq : posals for direct and indirect expenditures on national defence, it is not clear that the tapering .off will be sharp after the peak is passed l . Finally, the upturn is still too young to bring new maladjustments in the way of ac- ' cumulated stocks of goods, fresh rises in industrial costs or others which ordinarily stop an uptrend; and even if this rise does not extend beyond consumer goods and building it could go further, while the worst to be. expected within the near future would be a levelling off. GENERAL BUSINESS CONDITIONS. The month of October brought further evidence of business _ improvement, and despite some disappointments the indications for the near future have, continued favourable. No one would say that a surge of unqualified optimism is sweeping over America, for the situation is spotted. In the equipment industries particularly the demand is still lagging, and retail trade has been held back by unseasonably warm weather. Nevertheless, the business indices have been moving upward. Steel, automobile, and building operations have improved, and the textile industries nave held their ground. The Federal Reserve index of industrial production rose to 90 for September, _ from 88 in August, and the preliminary figures indicate another and probably greater rise in October. Moreover, some important upward revisions of factory schedules, which will apply to November, have been announced. Both security and commodity prices have been firm, with indications that buyers are willing to operate a little further ahead than formerly. SYDNEY MARKETS Press Association—By Telegraph—Copyright SYDNEY, December 1. The wheat market is steady, but growers are displaying little interest. Silo-grain is quoted at 2s 6sd, bagged 2s 7}d. Flour, £7 10s. Bran and pollard, £5. Potatoes: Tasmanian, £l3 10s; others, £l2. Onions, £ls; white, £l2 10s. Maize: Yellow, 4s 8d; white, 4s 6d.

RESERVE BANK RETURN STERLING EXCHANGE HOLDING LEVEL NOW AT £4,828,301 RATE OF FALL CHECKED The Reserve Bank return for .the week ended November 28, gazetted last evening, shows , a further decline in sterling exchange holding. At £4,828,301, it is £200,836 below last week’s figure. , , The proportion of reserve to notes and other demand liabilities is 32.685 per cent, compared with 33.723 per cent, in the previous week. The figures at the close of the previous week are given with this week s return for purposes _of comparison, shillings and pence being omitted: — LIABILITIES.

FINANCE IN FIJI BUDGET SURPLUS OF £6,220 Press Association—By Telegraph—Coypright SUVA, December 1. The Legislative Council budgeted for an expenditure of £1,090,387 in 1939. The estimated revenue is £854,148, and the estimated expenditure £847,928, leaving a surplus of £6,220. THE FRANC Press Association —By Telegraph—Copyright LONDON, December 1. (Received December 2, at 11 a.m.) The franc is quoted at 178$. SHARE QUOTATIONS Press Association—By Telegraph—Copyright LONDON, December 1. (Received December 2, at 1 p.m.) Share quotations; Clutha River—buyers Is 6d (ex div.), sellers Is 9d; Molyneux—buyers 7sd, sellers 10Jd.

STOCK AND SHAREBROKERS. INVESTORS I IT will pay you to deal through the progressive and busy firm who are in constant touch by, phone, radio, telegraph, and cable with alt overseas markets. Place your next inquiry through us and be assured of skilled advice before buying selling Stocks, Shares, or Debentures. THE SECURITIES CORPORATION (N. 55.) LTD., The Alliance Building, £0 Crawford street, Dunedin. Telegrams Toscol." Telephone 11-777. NEW YORK SHARE INDEX DOW JONES AVERAGE

DOLLAR AND STERLING Press Association —By Telegraph—Copyright LONDON, December 1. (Received December 2, at 1 p.m.) ; Sterling exchange, London on New

London on New York, during 1937 averaged 4.05 dollars to £1 sterling; on August 2, 1938, 4.90|; on September 1, 4.85 13-16; but declined to as low as 4.63 to the £ on September 28. During October the rate varied between 4.78$ (October 4) 'and 4.75$ (October 21).

PRICE OF GOLD Press Association —By Telegraph —Copyright LONDON, December 1. (Received December 2, at 1 p.m.) Fine gold is quoted-at £7 8s 6sd an

Highest price in 1938, November 26, £7 10s; lowest price in 1938, January 3, £6 19a 6d. Highest price in 1937, March 6, £7 2s 7sd; average price in 1930, £4 5s an ounce.

BANK OF ENGLAND RETURN Press Association —By Telegraph—Copyright LONDON, December 1. (Received December 2, at 1 p.m.) The following is the Bank of England return:— —lssue Department.—

Ratio of reserve to liabilities is 29.76 per cent. The Bank of England discount rates remain unchanged at 2 per cent.

DIVIDEND AND CALL LIST. DIVIDENDS DUE. Olutha River Dredge—lnterim, Jd (sterling, less British income tax) Dec. 3 Victoria Nyanza Sugar cent, per annum Deo. 7 Consolidated Brick and Pipe Investments, Auckland—lnterim, at 4 per cent., cum Dec. 7 North Broken Hill Quarterly, 6d a share Dec. 8 Loloma (Fiji) Gold Mines—ls per share (No. 3) ... Dec. 8 Bank of N.Z. share, ord., 3j per cent, on D long term mortgage shares ... Dec. 10 New Zealand Breweries Ltd.—lnterim, 4 per cent ... Dec. 10 Woohvorths (N.Z.) Ltd. Final, ord., at 11 per cent, per annum Dec, 13 Broken Hill South—6d a share ... Dec. 15 P. and O. Deferred —Final, 2J per cent., bonus 3 per cent Deo. 15 Mount Lyel)—Final, Is a share ... Dec. 19 Morris. Hedstrom, Fiji—lnterim, 3 per cent ... ... Dec. 31

COMPANY NEWS PROCERA BREAD PROCESS CHANGE IN AUSTRALIAN BUSINESS It was announced at the annual meeting of Procera Bread Process (N.Z.) Ltd. in Wellington that there were good prospects of increased turnover from the English company. A company had been formed to take over the management of the Australian business, the personnel connected with the new company being the same as had handled the Procera Company’s interests in Australia for the last few years. Arrangements were being made to organise the selling of some kindred products, both in Australia and New Zealand, with a view to augmenting the income from these places. GOLDSBROUGH MORT Holders of A and B debenture stock in Goldsbrough, Mort, and Co. Ltd. will be asked, at a meeting in London, to confirm the draft of a new consolidating trust deed. The directors state that the new deed will not involve capital reorganisation or modification of existing rights, but is designed to simplify the present" complicated trust deeds and, bring them into line with modern requirements. G. J. COLES LTD. Mr E, B. Coles has been appointed assistant managing director of G. J. Coles and Co. Ltd., Messrs F. G. Coles and M. B. Moffatt have been appointed general managers, and Mr F. Maclean merchandise manager. WOOLWORTHS PROPERTIES INTERIM DIVIDEND 6 PER CENT. Woolworths Properties Ltd. advises that an interim dividend has been declared at the rate of 6 per cent, per annum for the half-year ending December 31, payable on January 15. The dividend,.is in respect of 10s ; for four months and 20s for two months. Books close at noon on December 31. - ■ ' ' ■ ,' : ZING CORPORATION DECLARATION OF DIVIDENDS [Pea U mixed Press Associinoß. J WELLINGTON, December 1. The directors of the Zinc Corporation have declared the second half of the fixed preferential dividend of 2a on preference shares for the year ending December 31, 1938, less English income tax of 3s 2d in the £1; also an interim participating dividend of- Is fid per share on both preference and ordinary shares in respect of . the year 1938, less English income tax of 3s 2d in the £l. Both dividends will be paid on January 2, 1939, in English currency. ASSOCIATED NEWSPAPERS INCREASE IN NET PROFIT Associated Newspapers Ltd., Sydney, earned a net profit of £242.460 for the year ended September 25, against £238,365 in the previous year. The profit includes £375 surplus from the proceeds 'of S. Bennett Ltd. (in liquidation). Dividends have been maintained at 7 per cent, on both the ordinary and preference shares, and require £179,451. A sum of £40,000 is transferred to general reserve, £20,000 to newsprint cost equalisation reserve, and £2,000 to Provident Fund reserve. There remains £21,399 to be carried forward, against £20,391 brought into the accounts. AUSTRALIAN PRICE OF GOLD The price fixed for gold by the Commonwealth Bank for the week ended November 18 was the highest on record. The price, which applies to gold, including jewellery, at the Melbourne Mint, was approximately £8 8s 9jd an ounce standard (22 carats), or a premium of 116.77 per cent. The previous highest price was £8 8s 5d an ounce, or a premium of 116.25, fixed for the week ended March 1, 1935. On the week the price is Is ssd an ounce higher. Payment is made according to the assay value of the gold. The price for fine gold was £9 4s 2d an ounce, or Is 7id an ounce higher on the week. The previous record price was £9 3s B£d an ounce. GRAIN ACREAGE DECLINE IN WHEAT AND OATS (Per United Press Association.] WELLINGTON, December 1. The estimated return for wheat, oats, and barley this year, compared with the actual returns_ for the past harvest, show a decline in the acreages of wheat and oats, but a slight increase in the case of barley. The estimates are contained in a return by the Government Statistician and appear' in to-night’s ‘ Gazette.’ The total area sown in wheat for the 1937-38 season was 191,842 acres, while the estimated area for 1939 totals 188,900. composed of 3,200 acres in the North Island and 185,700 in the South. The area sown in oats in 1937-38 was 289,763 acres, while the estimated total for the present season is 263,000 acres, comprising 13,000 acres in the North Island and 250,000 in the South. The barley acreage last year was 31,604 acres and the estimate for this year 33,700, comprising 3,200 acres in the North Island and 30,500 in the South. The final area planted in potatoes last year was 23,090 acres, 5,442 acres being in the North Island and 17.6-18 in the South. The estimated return for this year is 20.000 acres, 5,300 acres being in the North, Island and 14,700 in the South.

MINING NEWS

QUARTZ INVESTMENTS LTD. FIRST ANNUAL REPORT Operations of Quartz Investments Limited have been confined solely to assisting and financing Quartz Mountain (Papua) Ltd., the advances being secured by a debenture over the whole of its assets and undertakings, states the company’s first annual, report. As the funds of both companies were exhausted a year ago, and shareholders did not respond to further appeals for assistance, the chairman (Mr J. W. Thomson) arranged for sufficient money last December to pay lease rents and obtain protection of the leases. Again in March he arranged one application for the balance of tbe shares to the value of about £5,200. The moneys received have been applied to general expenses and carrying out the policy oi development of Quartz : Mountain submitted by Mr D. P, Scott, M.A.I.M.M under the management at Misima of Mr C. H. Donaldson, a mining engineer from Canada. Mr Scott visited Misima last June. _ Both Messrs Scott and Donaldson advise that it is yet too early, to value the property, and it will be necessary, to complete the full 12 months’ development programme before this can be done. Mr Scott was appointed managing director. Mr Donaldson is in charge at Misima. Work has been hampered through shortage of native labour in common with the other mines on Misima. Mr S. A. Lyttle retires from the directorate, and offers himself for reelection. MOONLIGHT GOLDFIELDS DEVELOPMENT WORK CONTINUED NET PROFIT OF £1.120 Net profit of £1,120, after providing for depreciation aqd income tax, was earned by the Moonlight Goldfields Company Ltd. in the year ended October 21, 1938. The directors in their report say that at the beginning of the year, owing to the height of the face being worked, and the consequent danger of a stoppage of work by falls, it was, decided to proceed with'further dpvelopment. To provide an alternative working face the main pipe line was extended and the necessary branches put in and a completely new tailrace built._ The whole of this work has been carried out in a highly successful manner by the manager and his staff, ; The total amount of gold won during the year was 1,178 ounces, compared with 742 ounces in the previous year. FOREIGN EXCHANGES ON NEW ZEALAND CURRENCY BASIS . The Bank of Row South Wales, Dunedin, quoted the following rates to-day for purchase and sales of foreign exchanges (all rates subject to alteration without notice) : Buying. Selling.

DOLLAR RATES. The Associated Banks (other than the Bank of New South Wales) to-day quoted the following dollar rates on a New Zealand currency basis. They are subject to alteration without notice:— U.S.A. CANADA. (Per £1 N.Z.) (Per £1 N.Z.) SELLING— T.T. (dol) ... 5.71 7-8 3.74 S-16 O.D. (dol) ... 3.72 3-16 3.74 9-16 BUYINGO.U. (dol) ... 3.77 5-16 3.79 15-16'

Last week. This week. £ £ „ 1.500.000 1,500,000 3, Bank notes 14.496.272 14,587,364 3. Demand liabilities— 2,228,333 2,997,756 6,546,481 6,134,687 (cj Other 884,574 563,365 ■4. Time Deposits 5. Liabilities in currencies 19,880 173,1»3 land currency 6. Other liabilities 21.949 164,094 Total ASSETS. ' 2,801,791 (a) Gold 2,801,791 (b) Sterling exchange ... 5,029,137 4,828.301 (e) Gold exchange ... 8. Subsidiary coin 209,512 9. Discounts— (a) Commercial and agricultural bills • — (b) Treasury and local bodv bills 10. Advances— (a) To State or State undertakings (I) Primary Pro6,022,441 ing Department 4,499.033 8,500,000 8,500,000 (b) To other public authorities — — —- — 11. Investments 3.500,870 3,509,474 13. Bank buildings — — 13. Other assets ... 101,359 108,457 Total ... ... ... Proportion of reserve. (No. 7 less No. 5) to notes and other demand liabili32.685% ties 33.723% Sterling exchange is expressed in New Zealand currency. The 'movement of the sterling exchange held by the Reserve Bank has been, as follows since October 3 last;—

October S £ 10,594,978 October 10 9,960,235 October 17 , 9,118,330 October 24 8,313,675 October ’31 ... .1, ... 7,707,697 November 7 0,633,031 November 14 5,662,976 November 21 5,029,137 November 28 4,828,301 Since. October 3 last the proportion of reserve to liabilities has shown the following movements; — October 3 57.259 October 10 ... 57.903 October ... 52.27 October 24 ... ... ... ... 48.451 October 31 46.09 November 7 39.733 November 14 ... ... 36.825 November 21 ; 33.723 November 28 ... 32.685

Railroads. Industrials. Turnover. Dec. 1 29.78 148.63 860,000 Nov. 50 29.76 149.82 980,000 Nov. 29 29.06 147.07 820,000 Nov. 28 28.95 146.14 1.250,000 Nov. 26 29.89 148.45 690,000 Nov. 25 30 43 * ■ 150.10 810,000 Nov. 23 30,42 148.88 1,600,000 Nov. 21 30.77 150.26 940,000 Nov. 19 30.94 150.38 440,000 Nov. 18 30.80 149.93 1,420,000 Nov. 17 31.75 152.78 990,000 Nov. 16 31.20 151.54 1,790,000 ' Nov. 15 31.95 154.66 1,470,000 Nov. 14 . 32.36 155.61 . 1,650,000 Nov. 12 33.17 158.42 1,010,000 . Nov. 10 33.17 157.48 2,180,000 ■ Nov. 9 33.12 158.03 3,100,000 • Nov. 7 32.04 154.91 1,760,000 Nov. 5 31.78 152.12 430,000 ! Nov. 4 31.76 152.10 1,200,000 Nov. 3 32.56 142.31 1,070,000 Nov 2 31.66 152.21 780,000 Nov. 1 31.50 151.39 1,280,000 1938. Highest 64.89 194.40 Lowest 28.01 113.64 1937. Highest 33.17 158.42 Lowest 19.00 88.95

York, 4.68. November 30 ... 4.661 • November 29 ... 4,664 November 28 ... ... ... 4.644 November 25 ... ... ... 4.641 November 24 ... 4.66J November 23 ... 4.661 ’November 22 ... 4.671 November 21 ... 4.70 November 10 ... ... ... 4.74J November 1 ... 4.75 5-16 October 1 . ... ... ... 4.821 September 28 ... ... ... 4.63 September 27 .:. „. ... 4.73 September 1 ... 4.85/13-16 August 2 ... 4.90J July 1 ... ... 4.95f June 1 .... ... 4.94f May 2 #..... 4.9811-16 April 1 4.94J March 1 6.02

ounce. November 30 .. £7 9 1 November 29 .. 7 9 3 November 28 ... 7 9 9J November 25 .. 7 9 10i November 24 .. 7 9 2 November 22 .. 7 8 9 November 21 .. 7 7 Hi November 14 .. 7 6 8 November 7 .. 7 6 li November 1 .. 7 6 3J October 31 • •• • .. 7 6 0i October 28 .. 7 5 10i October 21 .*• • .. 7 6 2i October 13 .. 7 6 9J October 7 .. 7 5 0 October 3 .. 7 4 84 September 1 .. 7 3 0J August 2 * .. 7 1 8 July 1 .. 7 0 9 June 1 ... • .. 7 0 7i May 2 Aoril 1 .. 6 .. 7 19 64 7 04 March 1 ... .. 6 19 9i ■ February 1 .. 6 19 7 January 3 .. 6 19 5

Note issue in circulation ... ... £480,800,000 Bank department ... 45,600,000 Government securities ... 188,200,000 Other securities 600,000 Silver coin 200,000 —Banking Department.— Rest ... 3,300,000 Public deposits ... 23,100,000 Bankers’ deposits ... 97,100,000 Other deposits ... 37,200,000 Government securities ... 90,200,000 Discounts and advances ... ... 17,600,000 Other securities ... 20,600,000 Notes and coin ... 46,800,000

London— £100 stg. T.T. N.Z. ... O.D. £124 10/ £124 1/3 £125 £124 19/6 Australia— £A to £100 N.Z. T.T. £100 10/ £100 Fiji— £F to £100 N.Z. ... T.T. £90 £88 12 6 New York— Dollars to £1 N.Z T.T. O.D. 3.7755 3.7805 3.7265 3.7275 Montreal — Dollars to £1 N.Z. .' ... T.T. O.D. 3.8071 3.8158 3.7469 3.7479 Belgium— Belgas to £1 N.Z T.T. O.D. 22.434 22.509 21.894 21.899 Czechoslovakia — Korunas to £1 N.Z T.T. O.D - 106.52 106.54 Denmark — Kroner to £1 N.Z. ... ... T.T. O.D. 18.218 18.278 17.686 17.688 Finland— Marks to £1 N.Z. T.T. O.D. 186.15 186.55 176.00 176.10 France — Francs to £1 N.Z T.T. O.D. 145.34 140.34 140.36 Germany— Keichsmarks to £1 N.Z. ... T.T. O.D. - 9.179 9.181 Greece — Drachmae to £1 . N.Z. ... T.T. O.D. - 418.68 418.93 Holland — Florins to £1 N.Z T.T. O.D. 7.036 7.076 6.781 6.783 Italy— Lire to £1 N.Z T.T. O.D. - 70.59 70.61 Java— Florins to ‘ £1 N.Z. ... ... T.T. O.D. 7.006 7.046 6.746 6.748 Norway— Kroner to £1 N.Z T.T. O.D. 16.201 16.261 15.704 15.707 Noumea — Francs to £1 N.Z T.T. O.D. 150.34 136.84 136.88 Papeete— Francs to £1 N.Z T.T. O.D. 149.14 137.14 137.18 Sweden — Kroner to £1 N.Z T.T. O.D. 15.817 15.877 15.315 15.318 Switzerland — Francs to £1* N.Z T.T. O.D. 16.736 16.841 16.271 16.273 Hongkong— N.Z. pence to 1 dollar T.T. O.D. 18 7-16 18 13-32 19 3-32 19 3-32 India and CeylonN.Z. pence to 1 rupee T.T. O.D. 22 9-64 22 7-64 22 41-64 22 41-64 Japan— N.Z. pence to 1 yen T.T. O.D. 17 23-32 17 23-32 Singapore — N.Z. pence to 1 dollar ... T.T. O.D. 34 29-64 34 25-64 35 19-64 35 19-64