LONDON MARKETS.

Hawera Star, Volume XLV, 8 June 1925, Page 9

LONDON MARKETS.

STOCKS AND SHARES. GLUT OF NEW ISSUES. FALL IN FOREIGN EXCHANGES. BY CABLE—PRESS ASSOCIATION—COPYRIGHT. (Received June 8, 8.5 a.m.) LONDON, June 6. The gilt-edged section of the Stock Exchange i,s suffering from a severe attack of indigestion, its absorbing power being insufficient to assimilate the recent glut of new issues, of which the underwriters have been compelled to take up a very large proportion. It was hoped that' the distribution of a £50,000,000 dividend on the war loan at the beginning of the month would have had a good effect, but so far the public has shown no inclination to reinvest this money in any of the scripts, consequently as all these scripts are still quoted at heavy discounts the underwriters have been compelled to sell large quantities of other gilt edgeds, notably conversation loan, with the result that prices have given way all round. Another feature contributing to the weakness, was the expectation of further new issues in the near future, hut yesterday the impression gained ground that these new loans will he postponed until conditions are more favourable, and the markets closed with a slightly better tone. Other sections of the Stock Exchange reflected the weakness of the giltedged market, and there has been a notable apathy in the speciilative departments, the one exception being rubber shares, which have shown great activity, as the advanced price of raw material is now being reflected in profits and dividends, with the result that new investors are being attracted. FRANC DECLINES. A feature of the foreign exchange is the continuous decline of the French franc, and the consequent depreciation of the Belgian, franc and the Italian lira. To-day the French franc is quoted at 102.85.

An official statement by the French Government explains that the heavy selling of francs is due to genuine dollar and sterling requirements for the purchase of cotton and corn, hut doubts are expressed regarding the correctness of this view, as the import season is too far off to necessitate the covering of currency requirements, hut even if the explanation is correct, it proves that French importers are anticipating further depreciation of the franc. FRUIT MARKET. Apple prices are being maintained in a manner which surprises the importers, and the demand contiiiues so strong and supplies, ai-e clearing so well that the sellers’ ideas are decidedly bullish. We are having a spell of hot weather, which will bring strawberries along in another week or two, and when there is a glut of them apples may be affected, biit traders generally think this will not last more than a fortnight or three weeks, and afterwards they expert the demand for apples to he as good as it is now. WOOL. The wool trade is very quiet. Many mills iii Yorkshire closed for a week or 10 days, the usual Whitsuntide recess being extended owing to the general slackness, and in some cases in order to curtail production. An encouraging feature is that some spinners report that customers are giving out small orders more freely, encouraging the belief that they are of opinion that the values are now on a basis which will bring out business in piece goods, pro- 1 vided there is no further disturbance. There is no inclination to speculate, however, in either tops or yarns, buyers preferring to operate conservatively, pending a resumption of the wool sales in this country and Australia. As might be expected, the proposal to revive th© B.A.W.R.A. does not find support in Yorkshire. The Economist’s wool correspondent writes: ‘ ‘There are more objections to a scheme like the B.A.W.R.A. than advantages; there is no national nor Empire call for it, as there was during the war. Wool growers and wool users will not tolerate State interference with their business, except under dire necessity. The imposition of selling reserves will not compel usels to buy, and this is a fact of which the promoters of the scheme seem altogether to Have lost sight of. If the selling reserves are to be fixed users ought to have some say in the fixing of them, as industry depends just as much upon users as on growers.”