MARKETS AND INTERNATIONAL POSITION

Nelson Evening Mail, Volume LXX, 31 March 1936, Page 7

MARKETS AND INTERNATIONAL POSITION

“CITY” FAVOURABLY IMPRESSED BY MR EDEN’S SPEECH - THE WOOL OUTLOOK (United Press Association—By Electric Telegraph—Copyright LONDON, 28th March. Mr Anthony Eden’s speech favourably impressed the city, but it was overlate iii the week to be reflected by market quotations. The undertone was firmer, but little business is passing. Australian loans maintained considerable strength during the dullness affecting gilt-edged securities and there has been some consideration lately of the possibility of introducing in London the shares of some, leading Australian companies. The most difficult obstacles at present are exchange and the need for careful disposition in order Lo avoid double taxation.

Paris rather than London continues to feel the severest effects of the international situation. Exchange control is very active and official quarters are forced to deny panic rumours of the impending devaluation of. the franc. Selling on the Paris Bourse is chiefly confined to professionals, the public holding off. Confidence in expected to ,revive provided no further shocks como from Herr Hitler. Australian deposit rates continue to attract considerable attention in London. The “Economist” points out that on classical grounds alone there is a case for an advance in .mtcicst lates. Special circumstances caused a beginning to be made in deposit/ rates, the banks doubtless will also be obliged to increase loan rates. Australian trade expansion in conjunction with the depletion of London balances has reached a point where the time-honoured corrective of dearer motley is applicable. The episode between the Commonwealth Bank and the Bank of New South Wales illustrates Australia's need for a proper money market as ail instrument for orderly control by a Central Bank. .From this viewpoint it is unfortunate that the Commonwealth Bank’s first attempt to establish a bill market by issuing Treasury bills to the public should have involved a banking ! system imbroglio. WOOL OUTLOOK The firm of Dawson’s, commenting on the wool outlook, says the strength of the markets ail'd the soundness of prices seldom appeared more reliable. The paucity of supplies is a definite bull point. Crossbred supplies and stocks have been brought down for the first time in many years to a normal figure. The maintenance of the present rate of consumption should result in higher values. Germany’s urgent need for raw material should bring her more largely on to the market during the summer. Butter, continues irregular owing to heavy New Zealand arrivals offsetting the lighter Australian shipments.. There is a definite lack of speculative activity, though' it possibly may develop just before Easter. Danish has declined, but the margin over Australian and New Zealand is still far too wide to affect the latter.