TRADE OUTLOOK

Nelson Evening Mail, Volume LXX, 15 June 1936, Page 3

TRADE OUTLOOK

STOCK MARKETS STILL QUIET COMPANY PROFITS BETTER PRICES OF BUTTER APPRECIATE (United Press Association— By Electric Telegraph—Copyright; (Received 15th June, 10.55 a.m.) LONDON, 14th June. Despite Mr Blum’s declaration that he does not intend to devalue it, the franc is still the subject of recurring selling pressure, the City adhering to the view that, while devaluation may temporarily be staved off, ultimately it is inevitable, especially as M. Bium’s labour programme must enormously raise French costs. An important effect of the franc crisis has been to accentuate the seasonal tightening of short-term interest rates. EXCHANGE EQUALISATION FUND Owing to the operations of the Exchange Equalisation Fund, the Government has been forced to pay 18.1 per cent, for Treasury bills, the highest rate for two years. The stock markets are still quiet. Exceptionally good May unemployment figures for six years have heartened investors, while the firmness of Wall Street has reacted favourably in London. Giltedged picked up as a result of a bear covering, further heavy French pui■ chases. Industrials are quiet, but Cables and Wireless improved from last year’s low levels. The flood of company reports showing better profits is gratifying, though some fear this may encourage labour to demand higher wages. Negotiations on this matter are already proceeding in some industries, but there is no fear that the “stay-in” strike movement will spread to England. OPTIMISM IN BUTTER TRADE Commodities continue apathetic. A notable exception is butter, which has sharply appreciated owing to speculative and general buying. The Continent failed to augment the seasonal decreases of Empire arrivals. Low retail prices are due to intense competition. This has strengthened the demand, creating an extra strain on supplies. Prices developed irregularly towards the week-end owing to pro-fit-taking, but optimism is the keynote of the trade, especially as cold store stocks are believed to have altered little during the last fortnight, although normally they tend to increase at this time of the year. APPLE MARKET POOR The poor condition of the apple market is believed to be due to the fact that shipments are insufficiently spread out. Consequently quantities recently and at present arriving are considerably larger than at the corresponding period of last year. The trade has considered the advisability of cold-storing some of the fruit for higher prices next month, but in view of the advanced condition, decided it was too risky. A similar decline in values is reported from Liverpool for the same reason. Pears, however, are in good demand, and prices are showing a definite improvement. NEW ZEALAND MEAT The New Zealand Meat Producers’ Board displayed Smithfield lambs from the Taihape A. and P. Show with a view to ascertaining whether they are suitable for the London market. While excellent in shape and quality, they are a little heavy. The trade emphasises that weight is the deciding factor of the British market.