COMMERCIAL

Nelson Evening Mail, Volume LXI, 16 July 1928, Page 5

COMMERCIAL

LONDON STOCK EXCHANGE AN AWKWARD PERIOD. - - : United Press Association—By Electric Telegraph—Copyright Australian Press Association, LONDON, 14th 'July. The Stock Exchange passed through ■ a somewhat awkward period, not due to anything here but to conditions abroad, chiefly unfavourable money developments in New York with the advance in*the Federal Reserve Bank's re-discount rate to 5 per cent, and forced liquidation in. Paris and Brussels in connection with the Loewenstein eatastroph'y. Even the gilt-edged market has proved susceptible to these adverse influences,'" and although leadirxr stocks have only showed fractional declines there seems little hope Of any early improvement in v ' them for the present. - ■'••■>_ <'■ In some quarters the fear is expressed that the rise in the Federal'Reserve ' Bank's rate will necessitate an increase in our bank rate, but a well-informed • financial writer says there is no. need for anxiety. The Bank of England is in a stronger position than it has ever been since the outbreak of war. Ex- . change is certainly moving against us, but it is still a. long way from the point, when it would be profitable to export gold to the United States* and it is evident that the situation, compared with a year ago, has altered very much in .. our favour. So it seems improbable that a. rise in the bank rate will be necessary. ~ . .

On the other hand the present rate is likely •to become more effective," and discount in the open market should have a further advance.