THROUGH ANXIOUS TIMES.

Manawatu Standard, Volume LV, Issue 247, 16 September 1935, Page 7

THROUGH ANXIOUS TIMES.

LONDON STOCK EXCHANGE. STOICAL CALMNESS SHOWN. LONDON, Sept. 14. The Stock Exchange has been through anxious times lately and has met the situation with what one financial writer describes as consistent stoical calmness and, though prices all round inclined to weakness, there was no great amount of selling. M. Laval’s speech had an immediate tonic effect and, led by the gilt-edged market, there was a general recovery, all sections closing at the highest level of the week, industrial issues especially being good. Other favourable factors were the fall of the Treasury bill rate and the placing of a trustee issue of nearly £1,000,000 by the African Railway ‘Finance Company, guaranteed by the British Treasury. This is regarded as heralding a reopening of the new issue market for first-class stocks. City opinion of the situation is well described by the Daily Telegraph’s finuncial editor,, who says the general feeling of the markets is that the declaration of the French attitude has brought about at least an outside chance of a pacific setlement. It is also generally recognised that if events take that course there will instantaneously be an all-round recovery in security prices. The speeches of the British and French Foreign Ministers created a new hope in the minds of business men, not merely that an immediate war may bo averted, but that the League and all it stands for has been reprieved from what might have been sentence of death.

The writer emphasises the fact that leaders of the city have refrained from taking any of the steps which usually herald a first-class crisis. None of the great banks, for instance, has thought it necessary to take the precaution of closing credits or demanding increased cover from clients. The uncertainty regarding the outcome of the Abyssinian dispute is delaying many important financial undertakings, notably new capital issues, which cannot be made until the international situation is more settled. Issuing houses are ready with prospectuses amounting to many million pounds for companies desiring more capital to expand their business. These are firms in the building, engineering, aircraft, provisions, drapery and other industries, but the underwriters are holding back until the European situation clears and they are certain Britain will not be involved in any war. “Directly this position is established,” In states, "we may expect a flood of now issues, for conditions here are favourable to new flotations and much money awaits investment. Trade reports show general improvement. Commodity prices are advancing, and the higher employment figures are a source of encouragement, so that when the new issues come they will have a good reception.” A well-known financial writer says: “Apart from international politics, there has seldom been a time when conditions looked more promising for a further rise in many securities,, especially industrials.”